Chinese Steel Mills Gear Up for Technological Innovations to Improve Margins

According to the latest data released by China Iron and Steel Association recently, the Chinese steel industry this year has registered growth through innovations and its revenue in the first half of the year has increased substantially.

In the first half of the year, the key large-scale iron and steel companies national wide realized a total profit of 139.27 billion yuan, a year-on-year increase of 151.15%. As the economic benefits of companies improve, the company's asset-liability ratio continues to decline. At the end of June, the debt-asset ratio of key large-scale iron and steel companies fell to 67.30%, a year-on-year decrease of 3.97%. The overall performance of the steel industry in the first half of the year has been in stable improvement, the structure continuously optimized, and high-quality development took a new step.

Ms. Qu Xiuli, Vice Chairman of China Iron and Steel Association said that the most important thing is that the supply-side structural reform has played an important role. It will be largely completed since the initiative of capacity reduction started in 2016.

Through the three years of de-capacity and the ban on the production of Ditiaogang-low quality steel, the industrial structure of our steel industry has undergone a very big change, and the optimal capacity has been released from this year. Judging from the first half of the year, it can be clearly seen that the steel industry is shifting to high-quality development.

The situation of low profitability for a long-term in the steel industry has been reversed. Increasing investment in innovation and transforming into high value-added, and more environment-friendly production lines have become a common practice for steel companies.

Mr.Huang Yixin, head of a steel group in Jiangsu shared" We have carried out a large number of technological transformation and upgrading of our process equipment, eliminating all previous high-emission, high-polluting equipment, and small production line, thus realized large-scale, modernized and informationalized process equipment.

Judging from the situation till now, the production and operation of China's steel industry in the third quarter will continue to maintain a good momentum.