CHINA’S steel demand will increase slightly in 2021, supported by stable macroeconomic policies, the country’s top steel association said yesterday, even as the government has urged companies to produce less steel this year.

Economic policies that China adopted to cope with the COVID-19 pandemic will shore up China’s steel demand, Qu Xiuli, vice chairwoman of the China Iron and Steel Association (CISA), said at a news conference.

Citing the nation’s determination to reduce carbon emissions, the industry ministry had asked China’s steel sector to produce less crude steel in 2021 than the record 1.05 billion tons it logged last year.

The CISA’s vice chairman, Luo Tiejun, told yesterday’s briefing that higher demand this year could be met by other means.

“We can strengthen imports of primary steel products, especially billets … so that rising demand can be met without increasing output,” said Luo. Billet is a raw length of steel that has to be processed further.

Luo also said the government is planning to roll out favorable policies to encourage such imports.

The world’s top steel producer shipped out 53.67 million tons of steel products in 2020, down 16.5 percent from 2019. Its steel imports, meanwhile, jumped 64 percent last year, and billet imports rose by almost 500 percent, according to the CISA.

As the recovery of steel demand and production in other markets still faces difficulties amid the pandemic, the CISA expected China’s rising imports and falling exports to continue this year.

The association also warned of supply issues for steelmaking ingredients, which Luo described as one of the “sour points” of China’s ferrous sector.

(SD-Agencies)