As China moves through its 14th "Five-Year Plan" period, the country's steel industry is increasingly embracing a new phase focused on reducing for development and optimizing existing capacity, according to Luo Tiejun, the vice president of the China Iron and Steel Association (CISA).

Speaking at the 2025 CISA Steel Market Working Committee Annual Meeting, Luo highlighted key trends shaping the sector's future.

Firstly, both steel supply and demand declined. Between 2020 and 2024, China's crude steel production decreased from 1.07 billion tonnes to 1.01 billion tonnes. Similarly, apparent consumption of steel dropped by 155 million tonnes, from 1.05 billion tonnes to 893 million tonnes.

Secondly, there was an accelerated transformation in the product structure of steel production. The output of steel products for construction decreased significantly, while steel for manufacturing rose substantially.

Rebar output in China during 2020-2024 fell by over 70 million tonnes, while hot-rolled coil production increased by about 100 million tonnes. The share of steel demand from the construction sector fell from 58% to 50%, with manufacturing now accounting for 50% of total demand, up from 42%.

Thirdly, there was a significant divergence in the international market, with steel exports surging while imports sharply declined. In 2024, China's steel exports reached 111 million tonnes, more than double the 2020 figures, while imports fell by 66% to just 6.81 million tonnes.

Luo also pointed out that during the 14th "Five-Year Plan" period, the steel industry continued to face challenges, including declining supply and demand and shrinking profitability. Over the past four years, the industry's profit margin ranked among the bottom in China's 41 major industrial sectors.

However, since the beginning of 2025, the steel industry actively responded to challenges posed by strong supply and weak demand. Efforts focused on optimizing supply, expanding demand, and promoting transformation. Industry self-discipline strengthened.

Luo emphasized that 2025 marks the best year for the steel industry since 2022, despite a market downturn. The positive results were mainly attributed to a decline in fuel costs and the proactive self-regulation of enterprises.

Since 2024, the industry actively responded to national calls and made concerted efforts to implement anti-involution, which contributed to a relatively stable operating environment for steel companies.

Looking ahead to the 15th "Five-Year Plan" period, Luo identified the core issue for the steel industry as transitioning from growth to reduction in production. He stressed the importance of releasing steel production capacity in an orderly manner to maintain market supply-demand balance and ensure the industry's high-quality development.