Metal Bulletin’s 11th Steel Success Strategies conference in Istanbul last month attracted some of the steel industry’s leading opinion formers from around the globe and focused strongly on China throughout.
World Steel Dynamics’ managing partner, Peter F Marcus, the event’s ‘man of the match’, told delegates that the Chinese economy was likely to crash into the Great Wall in 2014 and that capital spending in China was falling, adding that the longer the Chinese economic model continues, the worst off the steel industry will be.
China was, understandably, a chief theme and the picture painted was fairly.
Baosteel’s chief market analyst, Jiang Li, said that steel capacity would slow down in future, but that 30Mt of new capacity would be added in 2014 as most Chinese steel companies report a deficit and the debt ratio reaches an all-time high.
Li said that 80Mt of steel capacity would be phased out over the next few years. She said that steel companies have reduced inventory levels to alleviate deteriorating cash flow and avoid price risks.
Steel Home’s Wu Wenzhang said that Chinese steel production in 2013 was up 7% to 728Mt and that reported product deliveries were up 11% to 1.02 billion tonnes with long products leading the field at 505Mt followed by flat steel at 450Mt. He said that East Asia accounted for 56% of Chinese steel exports and that the price of steel products in China would go up by 8%.
Antonio Marcegaglia, CEO of Italian steel processor Marcegaglia, said that the Chinese government’s 12th Five Year Plan showed a willingness to promote greater consolidation and capacity cuts.
For further coverage of Metal Bulletin’s Steel Success Strategies can be found in the March 2014 print edition of Steel Times International.