NEW YORK Chinese steel exports will remain at high levels through the end of the decade, a leading industry researcher predicted at the Steel Success Strategies XXIX conference in New York.
Wu Wenzhang, chief executive officer of Shanghai SteelHome Information Technology Co. Ltd., sees exports holding steady at 85 million tonnes annually through 2020, and trade complaints against China will not dampen this outlook.
Chinas increasing steel exports have been met with criticism since its own consumption appears to have peaked and steel markets in other countries have yet to fully recover from the Great Recession.
Chinese steel exportswhich totaled 60 million tonnes in 2013 and are running at an annual rate of 95 million tonnes so far this yearare expected to finish the year at 75 million tonnes, according to Wu, whose presentation at the conferencesponsored by AMM and World Steel Dyanmics Inc. (WSD)was given in English by Peter Marcus, managing partner of Englewood Cliffs, N.J.-based WSD.
Wu forecast that steel output in China will total about 810 million tonnes in 2014, up 4 percent from 779 million tonnes last year, including 60 million tonnes of net exports.
Chinese reinforcing bar prices will recover by the end of the year to $450 per tonne ex-works from $423 currently, while hot-rolled band prices will increase to $480 per tonne from $452, Wu predicted.
Li Xinchuang, president of China Metallurgical Industry Institute, said Chinese consumption may decline in future years but maintained it will nevertheless remain "at a high level for a long time," predicting 696 million tonnes in 2025. "Chinese steel production and consumption will be kept in the peak range for a long time," Li said.
Wu also notedin Marcus wordsan "incredible shakeout" of steel traders in China, which have fallen to 50,000 to 60,000 from 200,000 in 2010-11 and are expected to dip to as low as 20,000 within a year.
Electric-arc furnace (EF) production in China, which represents 8 percent of total raw steel output, could rise to a 15- to 20-percent share as more liquid pig iron is used in EF furnaces, Wu said.