NEWS

China Steel Industry Faces Ongoing Challenges

China's steel production has decreased by 1.5% to 166.3 million tons in January-February, fitting into the S&P Global forecast of a 1% decline in 2025. The industry is struggling with excess capacity, which has led to a crisis of overproduction. Despite growth in the manufacturing sector, particularly in the automotive industry, steel production has not benefited. In 2024, new car sales in China increased by 4.1%, but steel production decreased by 1.7%. The excess capacity is estimated to be around 200 million tons, and the government has announced plans to close metallurgical plants with a total capacity of 50 million tons by the end of the year. The Chinese government has introduced measures to strengthen steel export management and compliance with tax laws, aiming to minimize tax evasion and prevent steel dumping in third-country markets. However, export opportunities are narrowing due to anti-dumping duties imposed by countries such as Vietnam, South Korea, and the EU. The financial position of Chinese metal companies is also a concern, with a 50.3% decline in consolidated net profit in 2024. The industry's reliance on government subsidies and debt obligations raises questions about its long-term sustainability. With the housing construction crisis and infrastructure segment facing negative trends, the steel industry's challenges are likely to persist in 2025. METSFAB Pakistan - Pakistan's Dedicated Exhibition For Metals, Metal Forming, Steel Fabrication, Welding, Cutting & Finishing.