China’s actual finished steel demand may grow 5% on year for 2020, Luo Tiejun, vice chairman of the China Iron & Steel Association (CISA), shared at a recent stainless steel event in China, according to a CISA post.
“China’s steel demand declined by 30% on year in the first quarter of 2020 because of the pandemic, as activities in the construction and manufacturing slowed down substantially, but the demand from the downstream industries had recovered evidently in the second and third quarter,” he said when presenting at the event last Friday.
The projection by Luo was lower than the expected 8% on-year growth in China’s finished steel demand for 2020 by the World Steel Association in its Short Range Outlook released on October 15, Mysteel Global noted.
As for the country’s overall steel exports and imports, he predicted a 15% on-year decline in the former while a 60% on-year sharp growth in the latter, which will be equivalent to 54.7 million tonnes of steel exports and 19.7 million tonnes of imports for the whole 2020, Mysteel Global calculated basing on the official Customs data for 2019.
Over January-September, China exported 40.4 million tonnes of finished steel and imported 15.7 million tonnes of finished steel, and Luo’s prediction indicated that China’s steel exports will pick up in pace while imports will slow down in the last quarter of 2020, Mysteel Global noted.
Luo reaffirmed the market that China’s higher steel output so far this year has been spurred by the higher demand, and “China has been sharing the prosperity in its vast-sized domestic steel market with the world by importing steel from abroad”.
As for China’s stainless steel, a small portion of the overall steel output, Luo called for “high-quality development path”, encouraging the domestic enterprises to embrace advanced technology and to abolish the out-of-date facilities and process.
In 2019, China produced about 30 million tonnes of stainless, among which the 200-series accounted for 35%, or up 15 percentage points in a decade, which should be regulated and reduced via the newly-released quality standardization in September, he emphasized.
“China should focus on high-quality and higher corrosion-resistance stainless steel production, reduce the ratio of the 200-series so as to provide the consumers with the real stainless products,” he said.
China produced nearly 14 million tonnes of crude steel in the first half of 2020, down about 2.7% on year, among which, the 200-series including sub-quality accounted for 4.4 million tonnes, down 6.4% on year, and the ratio fell 1.2 percentage point on year to 31.4% of the total, according to the latest available data from the Stainless Steel Council of China Special Steel Enterprises Association.
The country’s apparent stainless consumption, on the other hand, fell 2.3% on year to 11.7 million tonnes over January-June, suggesting the market was still oversupplied, the association’s statistics showed.
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