Luo Tiejun: Challenges to direct and indirect steel exports may intensify
On July 11, a workshop for short-process electric arc furnace steel enterprises, hosted by the Electric Arc Furnace Steel Branch of the China Iron and Steel Industry Association, was held in Guangzhou. The meeting introduced the association's member services and held discussions on promoting the healthy and orderly development of electric arc furnace steel. This was the first working meeting held by the Electric Arc Furnace Steel Branch since its establishment on February 28. Luo Tiejun, Standing Committee Member and Vice President of the China Iron and Steel Association Party Committee, and Executive Vice President of the Electric Arc Furnace Steel Branch, attended the meeting and delivered a speech. Shi Hongwei, Vice Secretary-General of the Association and Secretary-General of the Electric Arc Furnace Steel Branch, presided over the meeting. Representatives from 40 independent electric arc furnace steel member enterprises, including Sichuan冶控, Guangdong Jinshenglan, and Ansteel Lianzhong, attended the meeting.
Luo Tiejun introduced the industry's operating conditions in the first half of the year, the positioning of the Electric Arc Furnace Steel Branch, and put forward requirements and expectations for the healthy and sustainable development of electric arc furnace steel enterprises.
He stated that in the first half of this year, the steel industry generally continued the positive trend since the beginning of the year, with overall steel production remaining basically stable (crude steel production decreased by 1.7% in the first five months, pig iron production decreased by 0.1%), steel prices although they have fallen, the fluctuations have been relatively small. The prices of raw materials have generally fallen more, resulting in a significant year-on-year increase in corporate profits (profits of association member enterprises increased by 57% in the first five months, sales profit margin was 1.93%, up 0.8 percentage points year-on-year). However, objectively speaking, the uncertainties affecting the stable operation and profitability of the industry may be more severe in the second half of the year. The real estate industry has not yet bottomed out, the challenges facing direct and indirect steel exports may intensify, and the risk of overcapacity in the steel industry still exists.
"The steel industry is facing the dual challenges of declining demand and stricter constraints on carbon reduction and low-carbon development. How to coordinate and respond to the new requirements of the new development stage is a major issue facing the steel industry, and how to play a greater and better role in electric arc furnace steel is a key move." Luo Tiejun emphasized that the association's positioning of the Electric Arc Furnace Steel Branch is very clear—the branch is not starting from scratch, but should carry out its work on the basis of the existing work of the association's various departments, conduct sufficient docking and communication, and support and cooperate with each other. The branch is both the main body for promoting and implementing specific work and a platform for coordinating and connecting all parties.
According to the introduction, with the rapid development and growth of China's economy and steel industry, the development of electric arc furnace steel has made significant progress. The overall scale of capacity and output has remained the world's largest for many years, and electric arc furnace steel has become an indispensable part of China's steel industry. Preliminary statistics show that there are more than 300 electric arc furnaces in production nationwide, with a capacity of nearly 200 million tons. The proportion of electric arc furnace steel output in crude steel output has been around 10% in recent years. The equipment and technology level has been significantly improved, and both production efficiency and product quality have reached new levels.
"Currently, the industry's understanding is gradually becoming clearer. While continuously developing long-process decarbonization technologies, the orderly development of short-process steelmaking is an important way to achieve low-carbon and green development. The development of electric arc furnace steel currently faces various 'difficult factors', but we firmly believe that 'the future is bright, and the road is tortuous'. We will work together to build the Electric Arc Furnace Steel Branch into a 'home' for the vast number of electric arc furnace steel enterprises, and contribute our due strength to achieving Chinese-style modernization in the process of achieving our own healthy and sustainable development." Luo Tiejun appealed.
At the meeting, Zhao Haiying, Deputy Secretary-General of the Electric Arc Furnace Steel Branch, introduced the work carried out by the branch in the more than four months since its establishment. Relevant persons in charge of the Association's Science and Technology Environmental Protection Department, Planning and Development Department, Information and Statistics Department, and Market Research Department introduced the ultra-low emission transformation of electric arc furnace steel enterprises, the governance and high-quality development of steel production capacity, the association's statistical survey system and electric arc furnace steel statistics, and the current situation and trends of electric arc furnace steel development abroad.
Participating enterprises exchanged their basic situations and current production and operation status in two groups, A and B, and conducted in-depth discussions and exchanges on capacity replacement, inclusion in the national carbon market, removal from the "two highs and one low" catalog, product quality improvement, enterprise financing, ultra-low emissions, scrap steel tax invoices, and electricity prices.
