Government Agency Forecasts Notable Decline in Chinese Steel Demand and Output

SEATTLE (Scrap Monster): The forecasts provided by the state-run Chinese Metallurgical Industry Planning and Research Institute says that the country’s crude steel production and demand are likely to record decline in 2020. The research body sees consolidation in world steel market to continue next year.

According to the report published by the government research body, the Chinese crude steel output is expected to drop by 0.7% to 981 million tonnes (Mt) in 2020, whereas the demand is expected to fall marginally by 0.6% to 881 Mt. It must be noted the current year production is forecast to grow by 6.5% to hit record high level of 988 Mt. Until October this year, the country has produced 829.22 Mt of steel. Also, 2019 domestic steel demand in the country is projected to surge higher by 7.3% to 886 Mt during 2019.

In 2019, the steel consumption in the country was primarily driven by rising infrastructure investment and rapid development in real estate sector. The stable industrial production also supported demand. The construction sector steel demand, which is expected to rise sharply by over 11% in 2019, is expected to drop marginally by 0.6% in 2020. The 2020 steel demand from shipbuilding and automobile industries are likely to witness decline by 11.5% and 3.6% respectively, in comparison with 2019.

The Chinese pig iron output may decline from 800 Mt in 2019 to 775 Mt in 2020. The iron ore demand is forecast to slide to 1.225 billion tonnes.

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