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China Steel Association Shi Hongwei: Investment in the environmental protection field of the steel industry will further increase

China Steel Association Shi Hongwei: Investment in the environmental protection field of the steel industry will further increase
Issue Time:2018-07-26
On July 20, 2018, "2018 Steel China Fujian Steel Market Summit Forum" was held in Wuyishan. At the meeting, Shi Hongwei, deputy secretary-general of China Iron and Steel Association, delivered a keynote speech entitled "The Status Quo and Direction of China's Steel Industry Development".
       Shi Hongwei looked forward to the steel industry in the second half of 2018.
       *, he predicted that the investment in the environmental protection field of the steel industry will be further increased. Environmental protection inspections, environmental protection and limited production will force steel companies to increase investment in environmental protection; "Electric enterprise ultra-low emission transformation work plan (draft for comments)" is released, and environmental protection standards are further improved. It is forced to increase investment in environmental protection or withdraw from the steel business.
       Second, demand for steel products remains relatively stable.
       Third, environmental protection and production restrictions will inhibit the release of some production capacity, which is conducive to the stability of steel prices.
       Fourth, coal and scrap prices will remain firm, and iron ore prices will fluctuate downwards, which will help steel companies stabilize raw material costs.
       Fifth, the capacity-intensive areas are limited by the total capacity of the environmental load, which will be transferred to non-capacity-intensive areas to optimize the production capacity.
       Regarding the supply-side reform, Shi Hongwei conducted a phased discussion. He said that the goal of resolving excess capacity should be solid, and the transformation and upgrading should be carried out throughout. The overall cycle of supply-side reform is ten years, divided into two phases. * From 2016 to 2020, the main goal is to make significant progress in the structural reform of the supply side of the steel industry, and to achieve fundamental deprivation of the whole industry; the second phase from 2021-2025, the main goal is to achieve significant structural reforms in the supply side of the steel industry. The result is a historic leap from the big to the strong in China's steel industry.
       He also elaborated on the policy priorities of the supply-side reforms in the steel industry. The focus in 2016 is to reduce excess capacity. The focus in 2017 is to reduce excess capacity, eliminate backward production capacity ("strip steel"), and de-leverage. The focus in 2018 is to de-leverage, de-capacity, and increase industrial concentration. In 2019, it is expected to de-leverage and increase industrial concentration. In 2020, it is expected to be ultra-low emissions, increase industrial concentration, and de-leverage. The focus of 2021-2025 is expected to improve quality and efficiency and increase industrial concentration. Each stage must be carried out in an orderly and step-by-step manner to promote the transformation and upgrading of the steel industry throughout.
       He also said that in 2018, the manufacturing industry showed a steady development trend, while steel exports and construction steel were worthy of attention. He believes that the three factors to be considered in market trade are green barriers, technical barriers, and trade barriers. The environmental protection level is related to the production and operation of enterprises, and the green trade barriers are related to the market access of enterprises.

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