STEEL NEWS

China will noticeably reduce steel production in January-March

According to the November forecast of Fitch Ratings, by the end of 2021, the apparent consumption of steel in China will amount to 1 billion tons, but in 2022 it will drop below this mark. At the same time, the total volume of production will continue to exceed 1 billion tons.

According to the agency, during the first quarter of 2022, Chinese metallurgical enterprises will reduce their steel production by about 30 million tons. Among the reasons - the introduction of winter restrictions on energy-consuming industries and measures to clean up the atmosphere, taken by the PRC authorities in the framework of the Olympic Games in Beijing.

Consolidation of assets in the Chinese metallurgy, as expected in Fitch Ratings, will accelerate - amid tightening environmental regulations and the transition to low-carbon production, requiring large investments that are inaccessible to small steel producers. A decrease in demand in the construction sector will lead to a revision of the range of metallurgical enterprises (including in favor of value-added products) and an expansion of the value chain in order to remain competitive.