Demand for Steel Is Weak in China

Weak demand and overcapacity become the top problems of the steel industry. After years of rapid growth, the steel industry has entered a stage of low-profit. Being the same as the building steel, higher end steel demand is still weak. Non-oriented silicon steel become popular for home appliances.

The difficulties faced by the steel industry are rather clear and enterprises have always been seeking for solutions. Mergers acquisitions and eliminating backward products are the topics repeatedly mentioned over the years. There has been a little success between the market and the executive power. Generally speaking, the steel industry is currently in difficult condition. The main reason is the overcapacity after the economic bubble burst and the steel industry must develop a through technological innovation to find new demand opportunities. The steel enterprises can always survive, one important reason is that they are protected by the local government.

Cement industry is developing and the relative cement making machine is in need. However, in the current production situation of serious excess capacity and sluggish demand, those steel enterprises who do not have the market competitiveness of iron are becoming the financial burdens of local government step by step. Through technical innovation, the steel enterprises can find a way out in the market through exports though international market.

For example, under the premise of ensuring safety performance, the manufacturers reduce manufacturing costs by lowering fuel consumption and reducing vehicle weight. Therefore the special thin gauge high strength steel is favored by the automobile manufacturers and the market demand is large. It is believed that the key enterprises will rebound because of the approaching winter. Market oversupply situation will be aggravated if large quantities of raw steel is produced. The price index procurement shows that purchase intention of these major steel is small....