China Steel Industry Face Many Hardship

Steel Industry in China always face many difficulties no matter the future development in domestic or in international environment. To china, there are a lot of important heavy industries supporting China’s development as backbone, meanwhile China steel industry is the vital important one. From 2005 to 2015, China steel’s capacity almost raised 2 times. There is another statistic data showing, since 2005 China steel exporting to world have raised drastically. From 2011 till now, China export of steel have more than double, in meantime 4 of main trade partners (United States, EU, Japan and Korea) have no more obviously increase. Before 2009, these four trade partners occupied 45% of steel export, however their share dropped to 23 percent in 2005. Following intensifying plunge, exporting to medium and low incoming economy has been increased gradually, which these economy mainly include Southeast Asia, Africa, Middle East, Latin America and Caribbean area.

Domestic Steel industry constraint by Government

According to statistic data, in 2003 China crude steel production as private companies and small mills only contribute to 5%. however till 2014, private companies contribute a huge data as raising to 50.36%. In last decade, we should know private companies in China play an important role and fully exploit their power to steel industry. But ambivalent situation always lasted to 2016 because of environmental protection issue. Though these small mills and private enterprises contribute enough to China steel industry, their low productive technology and low management have

had bad effect to natural environment. Government have to rule related conducts to constrain irrational private steel companies and require them to change old equipment and production lines so that adapt to new global competition and domestic competition. So there are a lot of private companies to be disrupted and actually from revenue angle, China face a lot of loss. Meanwhile some private companies also accept new management methods and introduce advanced equipment such as sinosources, the largest B2B steel platform in China.

International Negative Effect and Interfere

China as developing country around the world, sometimes it will face complicated international environment such as various of investigation and unfair sanctions from United States aiming to some of Chinese important industries of unfavorable factors to United States development. For instance, 337 case by launched and complained from United States Steel Corporation of Pittsburgh (U.S. Steel) in 2016. in meanwhile, except China, there are other 12 countries including Korean also to be probe by the U.S. International Trade Commission (USITC). Certainly, through long terms of ups and down and facing a lot of complaints, finally the US international Trade Commission said on 19th March, after probe, it found that US steel companies failed

to demonstrate antitrust damage, so China parts (China BaoWu Steel Group Corporation Limited) had won a lawsuit by this time contrast to a low rate of wining a lawsuit before, in the relevant cases that have been sentenced, the loss rate of Chinese enterprises was as high as 60%.

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