Nikkei reported that world's fourth-largest iron ore supplie Fortescue Metals Group expects Chinese steel production to keep growing despite an economic slowdown as government stimulus stokes demand. FMG CEO Ms Elizabeth Gaines told Nikkei “Based on discussion with customers and other key figures, Fortescue sees a 3% to 4% increase in crude steel production in China this year. In addition to the Chinese led Belt and Road Initiative for building ports, highways and railroads across Eurasia, the government's focus on further infrastructure development" at home is also underpinning demand for steel, and thus for iron ore. Continued investment in infrastructure is a way to continue to stimulate the economy. High-speed rail projects have been announced and new airports built.”
She added “The trade war with the US, that is weighing on the Chinese economy, has no direct effect on China's steel sector. Steel produced in China is consumed domestically and very little is exported to the US. But there might be some indirect impact.”
China, which accounts for half the world's crude steel output, churned out a record 928 million tonnes last year, up 10% from 2017.
Source : NIKKEI