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Reasons for strong growth of China's steel production in 2019

In 2019, the reason why China's crude steel production has increased significantly and continues to increase speed is that in addition to the strong domestic demand and the stimulation of enterprises' market share competition, many advanced production capacity has been added in recent years. Statistics show that in recent years (2016-2018), the national investment in ferrous metal smelting and rolling processing industry has reached trillion yuan. From January to October this year, investment in ferrous metal smelting and rolling processing industry in China increased by 29.2% year on year. Such a large-scale capital investment is bound to add a lot of advanced production capacity.

Another important reason for the strong growth of China's steel production in 2019 is the improvement of capacity utilization. With the entry of large-scale investment, in recent years, the level of science and technology and management of national iron and steel enterprises has been improved correspondingly. Statistics show that in the first three quarters of 2019, the capacity utilization ratio of the national steel industry increased by nearly 2 percentage points year on year, and the capacity utilization ratio of some private steel enterprises has exceeded 85%.

Not only that, in recent years, the relevant departments "iron hand environmental protection" put forward higher requirements for industrial emissions of steel enterprises. To adapt to this high pressure situation, iron and steel enterprises give priority to the use of high-grade iron ore, and to a certain extent, improve the output rate of existing iron and steel production capacity, that is, the utilization rate of production capacity has been greatly improved. According to the current crude steel production capacity and output calculation, the capacity utilization rate of China's iron and steel industry in 2019 is about 80%, or even more than 80%, which has entered a more reasonable level. The combination of the above factors will certainly provide a solid foundation for the continuous growth of China's steel production.