Li Xinchuang, president of the China Metallurgical Industry Planning and Research Institute, recently stated that China's actual steel consumption this year is expected to reach 693 million tons, with a projected increase to 715 million tons in 2015—a growth of 3.2% year-on-year. Despite this rise, overcapacity in the steel sector is expected to persist.
The comments were made at the 2014 China Steel Demand Forecasting Results Conference, organized by the institute on the 6th. According to the institute’s forecast, the slowing growth of key downstream industries such as machinery, home appliances, and containers has been a major factor behind the reduced pace of steel consumption growth. While China's economy continues to benefit from various positive factors and the domestic and international economic environment is gradually improving, significant improvement remains elusive. As a result, steel demand is expected to grow modestly in 2014.
According to the forecasts, among the eight major industries driving steel demand, the railway and automotive sectors are expected to see the largest increases in steel consumption next year—8.3% and 8.0%, respectively. The machinery and home appliance industries are also projected to grow by 5.3% and 5.0%. Meanwhile, the construction, energy, and container industries will experience only slight increases. However, the shipbuilding industry is expected to maintain the same level of steel demand as this year, due to the ongoing sluggishness in the global shipping sector.
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