China’s dominance on the world steel market is growing

Recently, China has been increasing its steel production, even though the industry as a whole is shrinking, which further increases the country’s market area.

World crude steel production in May decreased for the third month in a row by 8.7% compared to the same period last year and amounted to 148.78 million tons. Production in China is up 4.2% to 92.27 million tonnes this month. The World Steel Association released preliminary data on Tuesday.

China’s share reached 62%, up from just over half for 2019 as a whole. Metallurgists are increasing imports of iron ore, driving up prices and intensifying foreign competition for potential revenue losses.

“The threat from China cannot compare to what we have seen so far,” said Eiji Hashimoto, chairman of the Japan Federation of Iron and Steel and President of Nippon Steel.

China’s crude steel production this May set a monthly record by the National Bureau of Statistics. Investment in public works and the manufacturing sector has rebounded as part of government stimulus measures. This has spread to the country’s steel industry, which has gotten rid of the new coronavirus.

Steel production continues to struggle elsewhere. Steel production in the United States in May fell by 36.6% to 4.79 million tons, while the European Union’s figure fell by 26.8% to 10.49 million tons.

Production in India fell 39.1% to 5.77 million tons, compared with a 65.2% drop in April. Production in Japan fell 31.8% to 5.92 million tonnes, steeper than the 23.5% decline in April. In May, Nippon Steel suspended another blast furnace.

The global decline in May was less than 13.4% in April, mainly due to China.

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