2015 consumption is likely to fall by 4.8% year-on-year to 668Mt, it’s first fall since 1995, according to a report by the China Metallurgical Industry Planning and Research Institute (CMIPRI) in early December.
China’s crude steel output and iron ore demands are expected to be 806Mt and 1.12 billion tonnes respectively in 2015 and 781Mt and 1.073 billion tonnes in 2016, according to the CMIPRI.
Li Xinchuang, head of the CMIPRI, said that the fall in steel consumption was due to the economic ‘new normal’ in China and the general slowdown of the steel industry’s downstream sectors.
The root causes of the problem are slowing property investment and weakening manufacturing, according to the CMIPRI. Chinese domestic steel demand is expected to fall 4.8% year-on-year to 668Mt (2015) and will shrink further in 2016 to 648Mt (a drop of 3%).
On a global level, world steel demand is expected to fall 2% this year and a further 0.9% in 2016 to 1.51 billion tonnes and 1.5 billion tonnes respectively.
Looking at the situation sector-by-sector, steel consumption in the Chinese machinery industry is likely to fall 6.5% and by 7.2% in the construction sector. A fall of 7.7% is likely in the railway industry.
Source: China Metals