In 2017, the demand for steel products in China is expected to remain stable. However, due to the more complicated domestic and international market conditions, the steel industry is still in the process of transformation and recovery and there will be no major changes in the overall market, making it difficult for steel prices to rise sharply.

 

In 2016, the price of steel soared, so the steel industry reversed the depth of losses and achieved profitability. The first 11 months, the entire industry realized a total profit of 33.15 billion yuan, while a loss of 52.9 billion yuan a year earlier.

 

Ma Guoqiang, president of China Iron and Steel Association said that facing the market situation in 2017, we should not only be full of confidence, but also be soberly aware that although the iron and steel industry has achieved a turnaround, it has only reached a bottom and has not completely out of the woods. The whole industry is still running at a marginal profit, and still faces many difficulties and problems. It can not be blindly optimistic.

 

The report believes that to resolve excess capacity, eliminate backward production capacity is the key to the smooth operation of steel prices. In 2017, the capacity-to-capacity work of the steel industry will continue to move forward. Back-lag capacity such as strip steel and medium-frequency furnace will gradually withdraw from the market. However, from the overall situation, it is difficult for the domestic market to oversupply for a long time to be fundamentally reversed.

 

The report predicts that domestic steel production will maintain a high level in 2017 while the export volume of steel will decline, which makes it difficult for steel prices to continue rising sharply.