China’s Ministry of Industry and Information Technology (MIIT) will continue to promote merger and restructuring of key industries and cross-region enterprises in the iron and steel industry.
MIIT is to roll out specific and concrete measures to consolidate this industry, which still suffers a low level of concentration, said Miao Wei, Minister of Industry and Information Technology at the ministry’s annual work conference on Dec. 29.
The MIIT put high priority on consolidation of the iron and steel sector as the domestic steel makers suffered a low level of profit due to heavy production cost, as is reflected in soaring prices for iron ore, energy, and labour.
China’s average production capacity is less than 1Mt/y, and the top five steel companies produce only 28.5% of the nation’s total steel production, which is considered low if compared with other members in the BRIC block.
MIIT had earlier released targets and tasks for eliminating outdated capacity in the steel sector in the 2011-2015 period, but most major steel players seemed not to have taken them seriously as they thought there was still plenty of time left before the deadline.
In 2011-2015, the country will phase out 48Mt capacity of outdated blast furnaces, 48Mt of steelmaking capacity; and 42Mt of coking capacity. According to the MIIT, China has also increased its targets of eliminating outdated capacity in steel alloy production.
Source: China Metals e-mail email@example.com