Mr Liu Zhenjiang vice president of China Iron and Steel Association said that China steel industry steps into a crucial stage of transformation and upgrading due to overall depression. It performs slightly better in 2013 compared to the same period last year, but the problem of overcapacity hasn't been resolved yet.
In 2012, China steel industry saw the worst performance since the new century. The profit totaled 12.1 billion yuan and steel mills turned into profit from losses in the first nine months of this year.
The turnaround should be attributed to: a) steel mills those suffered huge loss last year reduce deficit in 2013; b) coal price fall helps lessen production cost. Nevertheless, current steel price has retreated to the same level of 20 years ago while production cost is 5-6 folds of that time, which is fatal to steelmakers.
Mr Liu said that China's crude steel production at present expands too fast, which is not accustomed to the growth of GDP. CISA vows to strengthen cooperation with Ministry of Housing and Urban Rural Development, military department, railway industry and shipbuilding sector to promote application of high-end steel products and expand new markets. Steel producers should intensify communications with end users to jointly develop new products.