China will continue to regulate steel production in 2024

China will continue to regulate steel production in 2024. This was announced by the National Development and Reform Commission (NDRC), without specifying the timing or scope of the restrictions, Reuters reports.

According to a statement by the NDRC, the regulator, together with the National Bureau of Statistics, the Ministries of Industry and Information Technology, Ecology and Environmental Protection, and Emergency Management, will work with relevant parties to manage production this year.

The departments will work to promote the development of the steel industry with a focus on energy conservation and carbon reduction, and will collect equipment information from steel producers across the country.

In 2021 and 2022, Beijing ordered the steel sector not to increase production to limit carbon emissions in one of the most polluting industries. This resulted in a 3% y/y drop in production in 2021 and a 2.1% y/y drop in 2022, which contributed to a decline in iron ore imports.

Despite the fact that the Chinese authorities have not made any public statement on the maximum level of steel production in 2023, last year’s production volumes remained unchanged compared to the previous year, amounting to 1.02 billion tons.

Earlier, 15 major producers of long products in China called on the authorities to take measures to limit the output of their respective products amid falling steel prices. Prices for long products have fallen sharply amid continued weakness in China’s real estate and infrastructure sectors, which has led to losses and reduced margins for local producers of the relevant products.

Earlier, the China Iron and Steel Association (CISA) called on steel mills to reduce production intensity to meet customer needs and balance supply and demand. The steelmakers were asked to take into account steel sales and business performance.