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China steel output may shrink 20pct: Baosteel chairman

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Publish time: 23rd October, 2015      Source: www.cnchemicals.com
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China's steel production could eventually shrink by 20%, regardless how long it takes, said Xu Lejiang, chairman of industry giant Baoshan Iron and Steel Co., (Baosteel) on October 21,.If we extrapolate the previous experience in Europe, the United States, Japan, their steel sectors have all gone through painful restructuring in the past, with steel output all contracting by about 20%, said Xu.China’s crude steel output increased 0.9% from the year before to 822.7 million tonnes in 2014; the output was down 2.1% year-on-year to 608.94 million tonnes in the first nine months of 2015, said the National Bureau of Statistic (NBS).In September, the country’s steel output contributed 50.5% of the global output to 66.1 million tonnes.However, China’s steel demand has been falling after peaking in 2013, impacted by cooling building and manufacturing industries. China’s demand for steel in 2016 was forecasted to fall 2% on year to 670 million tonnes, said the World Steel Association. The demand may fall 3.5% on year to 690 million tonnes in 2015, compared with a year-on-year drop of 3.3% in 2014.The industry recorded losses of 18 billion yuan ($2.8 billion) in the first eight months of this year, Xu said, reversing a 14 billion yuan profit from the same period a year ago.China's economy logged its worst performance since the global financial crisis in the third quarter with gross domestic product growing just 6.9% -- its slowest rate in six years.