China Focus: Steel Industry Facing Hard-to-Predict Prospect in 2006
Posted on: Saturday, 4 March 2006, 09:00 CST
China Focus: Steel industry facing hard-to-predict prospect in 2006
by Gao Li
BEIJING, March 3 (Xinhua) -- "It's too early to say that China's steel industry is going to suffer overall economic losses, " said Qi Xiangdong, vice secretary general of the China Iron and Steel Association.
Qi's remarks, which were published by Shanghai Securities News on Friday, came in response to a report of the State Development and Reform Commission (SDRC), the nation's leading industrial watchdog, on trends in the steel industry in 2006.
The report released on March 1 said that China's steel sector, the biggest in the world, will get meagre profits and even losses this year due to falling steel prices and rising material costs.
The content of the report posted on the website of SDRC, however, was later revised in the same day.
The revision of the forecast was reportedly related to the strong reaction to the SDRC report by the country's steel enterprises, which said the prediction will have a negative impact on the sector's confidence in the recovery of the steel industry.
"There is no space for steel prices to drop further," said Qi, taking the recent steel price hike by China's top steel maker Baosteel as an example.
Compared with last year's fourth quarter, the price of panel has increased by as much as 1,000 yuan (125 U.S. dollars), he said.
In 2005, the profits of China's steel enterprises amounted to 127.4 billion yuan (15.9 billion dollars), up 0.96 percent year-on- year.
Officials of the China Iron and Steel Association estimated early this year that the industry's profits will stand at above 50 billion yuan (6.25 billion dollars) in 2006.
Last year, China's steel production capacity reached 470 million tons. An extra capacity of 70 million tons is being built, according to SDRC.
The nation's steel output hit 352 million tons last year.
China Iron and Steel Association said the country imported 275 million tons of iron ore in 2005, a net increase of 67.18 million tons, and the import is expected to grow by 25 million tons in 2006 as the growth of demand drops.
It predicted China's crude steel output will rise by around 10 percent to reach 384 million tons this year from 2005.
Industry insiders believe that the sluggish steel market will create conditions for speeding up the sector's mergers and acquisitions this year.
The association suggested departments concerned work out supporting measures and policies as soon as possible to solve the "complicated issues" in the course, which will necessitate redistribution of interests among different regions and between local and central governments.
Source: Xinhua News Agency - CEIS
Related Articles
- From January to February of 2008, the Entire Income and Profits of China's Beer Industry Were Up 16.2 Per Cent Year on Year
- The Sales Market of Laptops Stands in a Monopoly Situation According to New Study 'China Laptop Industry Report, 2006-2007'
- The Steel Wire Drawing Industry's Revenue for the Year 2006 Was Approximately $4,460,000,000
- From January-March 2006, the Business Volume of China's Communications Industry Reached RMB 343.72 Billion
- Production in China's Medicine Industry Reached 113.4 Billion RMB, a Year on Year Increase of 20.7%
- Corporate News: China Telecom Records 27.9 Billion Yuan in Net Profits in 2005
- China's Energy Industry Imports Technology Worth 9.34 Billion Dollars in Five Years
- The Cargo Handling Capacity for Ports in China is 2.8798 Billion Tons, an Increase of 18.3%
- Profits in China's Chemical Industry Up 47 Percent
- China's Major Oilfield Pumps 22.6 Million Tons of Oil in First Half of 2005
 |
 |
User Comments (0)
RSS Feeds