Inner Mongolia-based Chinese steelmaker Baotou Iron and Steel Co. (Baogang Group) has announced that the technology upgrade of the rolling line No. 2 steel at its rail and beam plant has entered the final phase. Baogang expects to achieve an overall annual steel rail output capacity of 1.5 million mt after completion of the upgrade.
The annual steel rail production capacities of the four major steel rail producers in China, i.e., Baogang, Pangang, Ansteel and WISCO, have reached a combined 4.2 million mt, which may cause a problem of overcapacity, as stated by Zou Yanchun, the director of Baogang Rail and Beam Plant. Nevertheless, it is generally considered that the Chinese steel rail market faces a prosperous future given China's railway construction plans for the coming years.
According to China's Ministry of Railways, investment in railway construction in China is expected to reach RMB 516 billion ($82.8 billion) in 2013, while China is expected to complete construction of railways with a total length of 27,000 kilometers during 2012-2015.