No foreign controlling stakes in steel firms
By Gong Zhengzheng (China Daily)
Updated: 2005-07-14 05:55

However, Tian said foreign steel giants still have many opportunities because China's steel sector and market will continue to grow rapidly, although they will be banned from having majority stakes in domestic steel mills.

"Foreign steel giants could also accelerate technical collaborations with Chinese partners," he added.

China produced 272.8 million tons of steel last year, up by 22.7 per cent from 2003.

The steel association predicted earlier that the nation's steel output will reach 300 million tons this year.

Qi said the expected steel policy will boost associations between Chinese steel makers in different regions through cross-shareholding and other measures to form bigger groups that will improve the fragmented sector's competitiveness.

Zhou Xizeng, from CITIC Securities Co Ltd, said, "The new steel policy also indicates that the government hopes to put China's steel sector in order, instead of letting foreign giants do it."

There were 871 steel producers in China by the end of last year, of which only 15 had an annual crude steel output of more than 5 million tons.

Shanghai Baoshan Iron and Steel Corp, China's biggest steel maker, only ranked No 6 in the world. The company now has an annual steel production capacity of more than 20 million tons, compared with Mittal's 58 million tons and Arcelor's 46 million tons.

Luo Bingsheng, another top official from the steel association, last month suggested that Chinese steel companies should form four to five bigger groups with an annual steel output of more than 30 million tons through M&As within the next two to three years.

Anshan Iron and Steel Corp and Benxi Iron and Steel Corp, another two Chinese steel heavyweights in Liaoning Province, are expected to merge to form a new group this month or later, said sources from the two companies. It should have a production capacity of more than 20 million tons.

China imported 13.2 million tons of steel products in the first half of this year, up 26.8 per cent from a year ago, according to Qi.

Meanwhile, the nation's steel exports surged by 154 per cent to 11.6 million tons.

China imported 133 million tons of iron ore in the period, up 34.3 per cent.

(China Daily 07/14/2005 page9)

Close

Special police detachment established in Xi'an Panda cubs doing well in Wolong Suspect arrested in Taiwan

Today's Top News     Top China News
Taiwan's KMT Party to elect new leader Saturday         'No trouble brewing,' beer industry insists         Critics see security threat in Unocal bid         DPRK: Nuke-free peninsula our goal         Workplace death toll set to soar in China         No foreign controlling stakes in steel firms	No foreign controlling stakes in steel firms       China-made telescopes race to space       'No trouble brewing,' beer industry insists       HK investors cautious on mainland homes       Law in pipeline to ban money laundering       Overseas students test their Chinese abilities