What new growth areas are identified for steel demand following the Central Urban Work Conference's policy direction?
After 10 years, the Central Urban Work Conference was held in Beijing on July 14th and 15th. For the steel industry, the signals sent by the conference will affect the domestic steel market and the structure of steel demand, which has attracted high attention and importance from all parties in the industrial chain.
The real estate industry's "steel demand" has a certain degree of resilience and is still the largest area of steel consumption
When the author interviewed operators in the steel circulation field, they received feedback that these days, the rebar and wire rod, etc. sales of construction steel have increased and prices have steadily climbed, which is closely related to the recently held Central Urban Work Conference.
The Central Urban Work Conference deployed seven key tasks for urban work, one of which is to "accelerate the construction of a new model for real estate development and steadily promote the renovation of urban villages and dilapidated houses." Recently, the Party Group of the Ministry of Housing and Urban-Rural Development of the CPC also held a theoretical learning center group study (expanded) meeting, emphasizing that urban renewal should be placed in a more prominent position, and a series of livelihood projects, safety projects, and development projects should be implemented in a coordinated manner. Accelerate the construction of a new model for real estate development and steadily promote the renovation of urban villages and dilapidated houses. Recently, the National Bureau of Statistics stated that it is necessary to promote the stabilization and recovery of the real estate market with greater efforts. In this light, the real estate industry's "steel demand" has a certain degree of resilience and may still be the largest area of steel consumption, but the intensity of "steel demand" will weaken and the structure of "steel demand" will change.
According to industry analysis and statistics, real estate steel consumption is mainly concentrated in construction steel such as rebar and wire rod. The average steel consumption per square meter of building is 40 kg to 50 kg, and the steel consumption of steel structure buildings can reach 150 kg/square meter. Civil real estate, infrastructure, and industrial plants are large consumption areas for construction steel. In recent years, real estate regulation policies have led to a slowdown in the growth rate of residential construction investment, coupled with the shift of infrastructure investment to high-quality projects, the total demand for construction steel has shown a downward trend. In 2024, the steel consumption of the real estate industry continued to decline, but the steel consumption accounted for 50% of the overall steel consumption, indicating that the demand of the real estate industry still occupies an important position.
Liang Taigeng, general manager of Shanghai Hualei Enterprise Development Co., Ltd., which specializes in the trade of construction steel, said in an interview with China Metallurgical News: "Urban construction will not be demolished and rebuilt on a large scale in the future, and the amount of steel used in the real estate market is still decreasing, and the decline will narrow in the later period."
The "steel demand" structure of urban construction is changing Energy-saving, environmentally friendly, and green steel become the "main force"
The Central Urban Work Conference proposed to carry out high-quality urban renewal, focus on building comfortable and convenient livable cities; focus on building green and low-carbon beautiful cities; focus on building safe and reliable resilient cities, promote the construction of urban infrastructure lifeline safety projects, and accelerate the renovation and upgrading of old pipelines.
From the urban construction development direction and construction focus clarified by the Central Urban Work Conference, the "large-scale incremental expansion stage" has entered the "stock quality improvement and efficiency enhancement stage." Industry analysts believe that the 2015 Urban Work Conference clarified that the three-year shantytown renovation plan is the core, and the monetization resettlement is used to drive incremental housing demand. The essence is to stabilize growth through incremental expansion and inject strong impetus into driving "steel demand." After the 2015 meeting, shantytown renovation and infrastructure investment drove steel demand. The 2025 Urban Work Conference focuses on high-quality urban renewal, clarifying that there will be no large-scale demolition and construction, and the time span will be extended to 2030. This means that the structure of steel demand will change greatly, and the quality will be more obviously improved.
From a quantitative point of view, pipeline network renovation in urban renewal, such as the 120,000-kilometer underground pipeline network renovation plan in 2025, and the construction of resilient cities (flood control and drainage, emergency facilities) will drive rebar, medium and heavy plates 、 steel pipes and other steel demand. From a qualitative point of view, the Central Urban Work Conference proposed to build green and low-carbon beautiful cities, and the national new urban buildings will fully implement environmental standards in 2025. Ultra-low energy consumption buildings and renovation projects will drive the demand for high-performance steel. It is estimated that the consumption of steel structures will reach 140 million tons in 2025, of which the proportion of green steel products will gradually increase.
According to industry analysts, steel for residential buildings can usually be divided into steel for steel structures and concrete steel structure. Among them, the latter mainly uses construction steel such as rebar, round steel, and wire. In recent years, the amount of steel used in reinforced concrete structures in the real estate industry has decreased year by year, because steel used in reinforced concrete structures is easily corroded and needs to be treated with anti-corrosion during use. In addition, in high-temperature environments, steel used in reinforced concrete structures such as rebar will undergo thermal expansion, which may cause structural deformation or damage.
Steel structure (composed of steel plates or section steel and other types of steel connected by welding, bolts, etc.) stands out with its advantages of high strength, light weight, good seismic performance, short construction period, convenient transportation, green environmental protection, and recyclability. Steel for steel structures mainly includes carbon structural steel and low-alloy high-strength structural steel. Among them, carbon structural steel has high strength, good plasticity, toughness, weldability, and low cost; low-alloy high-strength structural steel has the advantages of light weight, high strength, good corrosion resistance, good low-temperature resistance, strong impact resistance, and long service life. It has good weldability and cold workability and can be used as the main structural material for high-rise and large-span buildings. According to the China Steel Structure Association, the processing volume of steel structures in my country is expected to reach 140 million tons this year; by 2035, the processing volume of steel structures in my country is expected to reach 200 million tons. This means that the demand intensity for steel used in steel structure manufacturing will be significantly enhanced.
The demand for "green steel" cannot be fully met Steel companies also need to increase their research and development and production efforts
Industry insiders believe that with the implementation of the spirit of the 2025 Central Urban Work Conference in various places, and with the rapid rise of "green buildings", high-strength, corrosion-resistant, and environmentally friendly "green steel" will have great potential and broad development prospects.
Steel structure residential buildings are modern "green buildings." Compared with traditional reinforced concrete buildings, steel structure residential buildings save more energy and are faster to construct. In particular, the construction speed of cold-formed thin-walled steel structure houses is accelerating significantly.
Currently, the demand for high-strength steel in the construction industry is increasing, and the 'green steel' required for 'green buildings' cannot be fully met. With the acceleration of urbanization and the continuous advancement of infrastructure construction, high-rise buildings, large-span bridges, and other structures require higher strength and toughness of steel. The application of high-strength steel in building structures can not only improve the safety of buildings but also reduce steel consumption and lower construction costs.
Industry insiders believe that currently, in the field of steel for residential buildings, the supply of steel for steel structures is still insufficient, especially the supply of high-strength, corrosion-resistant, and environmentally friendly 'green steel' has a certain gap. According to the spirit of the Central Urban Work Conference, steel companies should combine market demand and increase the research and development of corresponding steel products.
