International Steel Mills
March 13, 2016
IHS Global Correction & Comments on China Capacity Reductions
Written by John Packard
IHS Global Insight China Steel Analyst reported Hebei province was to remove 200 million metric tons of steelmaking capacity. Steel Market Update asked the IHS analyst (Brian Jackson) whether the Chinese mills were taking the issue of closing down capacity seriously, as these sort of promises have been made in the past with little to no results. We received both an answer to our question and a correction to their original press release:
I think China is taking this issue much more seriously now, not out of enlightenment but rather necessity. With most steel firms losing money and the construction sector extremely unlikely to rebound (in levels) in a meaningful way, the writing is on the wall that a consolidation has to take place.
