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Baosteel Chairman: China's steel production or reduced by 20%

Release time: 2016-05-05
Browsing times: 16

China's steel industry is losing a lot of cash, and every producer is feeling the pain, according to the chairman of the second largest steel producer in China. Baosteel is expected, the national steel production may be reduced by 20%. China's iron and steel industry ranks first in the world.

Baosteel Group Chairman Xu Lejiang said on Wednesday to Peng Bo, the steel industry in the first 8 months of this year, a total of 18 billion yuan ($2 billion 800 million), while the same period last year earnings of 14 billion yuan. He said production could eventually shrink by 1/5, consistent with the experience of the United States and other regions.

China's steel demand is falling as China's economic growth slows. China's steel industry has entered a reversal after decades of expansion. China to the global market to increase the supply of steel, which led to the decline in steel prices, iron and steel enterprises profit decline, as well as increased international trade friction. At present, China's steel production accounted for half of the world. According to the World Steel Association, China's steel demand in the next two years will continue to slow down, the continuation of negative growth since 1995.

Xu Lejiang said that if Europe, America and Japan before the experience from the point of view, the iron and steel industry after a painful restructuring, steel production decreased by about 20%; China will ultimately appear this kind of circumstance, regardless of how long it takes.

And according to international experience, in the production decline in the same time, the steel industry employment will be significantly decreased.

Everbright Securities in the report pointed out that the number of industrial workers in the British Steel Industry in 1974-84 ten years from nearly 200 thousand people fell to less than 70 thousand people, down 65%. U.S. steel workers from more than 500 thousand people fell to 230 thousand people, or more than half of the decline. West Germany fell from 230 thousand to less than 170 thousand people, France from nearly 160 thousand people fell to less than 90 thousand people, Luxemburg from 24 thousand people fell by half to 12 thousand people. In 1870 the world's steel production accounted for nearly 40% of the British steel industry, in 1980 production accounted for only 2.7% of the world's total output.

Although the world's steel industry has experienced several recovery since the 1980's, the number of people in the industry and steel industry has not recovered to the level before the crisis in the 1980's.. For example, the British iron and steel industry workers count to 2000 was less than 30 thousand people, the United States in 2000 about 150 thousand people, the total number of things Germany combined with the total number of steel industry in 2000 less than 70 thousand people. Luxemburg, once an important steel producer, has only about 4 thousand people in the steel industry in 2000. (Wall Street knowledge)

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