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Try the Free AI Search EngineChina Steel Market Under Pressure: Plant Activity Declines Amidst German Political Scrutiny
In China, steel production faces potential headwinds amid German political scrutiny regarding trade practices. While no direct link can be established, activity levels at key steel plants have decreased recently. The political climate is highlighted in articles such as “Klingbeil reist nach China: „Dann wirkt das außenpolitisch schlicht planlos“ – Grünen-Chefin attackiert Vizekanzler,” and “Kritik an Klingbeil: „Nach der Moskau-Connection brauchen wir nicht noch eine Peking-Connection“,” suggesting increased pressure for fair competition and potentially impacting future trade relations.
Observed activity shows a decline in the average steel plant activity in China. The mean activity decreased significantly from 43% in September to 25% in October. Chongqing Iron & Steel Co., Ltd. reached peak activity in September and October at 100%, while Xining Special Steel Co., Ltd. does not show activity for the most recent months. Bengang Steel Plates Co., Ltd. shows a decrease in activity, from 52% between July and August to 40% in October.
Xining Special Steel Co., Ltd., located in Qinghai, primarily uses integrated (BF) processes with both BOF and EAF technologies, producing 2,000ktpa of crude steel with a focus on specialty products like automotive and military-grade steel. Activity was high between June and September (77-94%), but no activity was recorded for May and October. No direct connection between this trend and the named news articles can be established.
Chongqing Iron & Steel Co., Ltd., based in Chongqing, operates with integrated (BF) processes and BOF technology, boasting a crude steel capacity of 8,400 ktpa, producing semi-finished products and finished rolled products. Activity increased steadily, reaching 100% in September and October. Despite peaking production levels, no direct connection to the concerns expressed in articles like “Lars Klingbeil in China: Grüne Kritik an Reise,” which highlights potential supply chain disruptions, can be established.
Bengang Steel Plates Co., Ltd., situated in Liaoning, has an integrated (BF) process, utilizing both BOF and EAF technologies to produce 12,800 ktpa of crude steel, specializing in automotive and appliance plates. The activity experienced a recent decrease, from 52% in August to 40% in October. While activity decreased, no direct connection with news articles concerning supply chain concerns can be established.
The political scrutiny highlighted in articles such as “China-Besuch von Lars Klingbeil: Grüne Kritik an Reise,” which raises concerns about fair competition, coupled with the observed decline in average steel plant activity, suggests a potential market downturn. Steel buyers should closely monitor contract clauses related to delivery timelines and force majeure. Due to potential supply disruptions, diversifying suppliers might be considered, especially for specialized steel grades usually sourced from Xining Special Steel Co., Ltd. and automotive steel products coming from Bengang Steel Plates Co., Ltd. Analysts should monitor policy changes resulting from the German delegation’s visit and their potential impact on steel trade.