Jiang Wei: The development model of the steel industry has undergone significant changes.
“Since the 14th Five-Year Plan, China’s steel industry has been reshaping its landscape through development focused on reduction, while achieving breakthroughs and upgrades in its green transformation. Today, the industry is steadily advancing toward a new stage of high-quality growth,” stated Jiang Wei, Deputy Secretary of the Party Committee, Vice Chairman, and Secretary-General of the China Iron and Steel Association, at the 2025 Annual Conference and Energy Conservation & Environmental Protection Technology Exchange Meeting of the Association’s Energy Conservation and Environmental Protection Committee on November 19.
“This marks the first time China’s steel industry is entering a ‘reduction-oriented development’ phase—characterized by prolonged duration, significant declines, and rapidly accelerating contraction. The industry’s development model has already undergone a notable transformation,” Jiang Wei clearly pointed out during his speech, highlighting the new, stage-specific features of the sector’s evolution.
Data reveals that since the start of the 14th Five-Year Plan period, domestic apparent steel consumption has declined for four consecutive years, with overall steel production trending downward as well. Specifically, domestic apparent consumption plummeted from a peak of 1.04 billion tons in 2020 to 890 million tons in 2024—a drop of 150 million tons, representing an average annual decline of 3.8%. In the first three quarters of 2025, domestic apparent consumption stood at 649 million tons, down 5.7% year-on-year, with the decline continuing to widen.
Jiang Wei stated: "As overall volumes decline, the traditional approach of industry-wide expansion and competing on quantity has given way to a new paradigm focused on optimizing existing assets and winning through quality. Over the past four-plus years, steel companies have actively explored operational models suited to this era of reduced output, with SMEs particularly excelling in niche segments by honing their expertise—achieving lower costs, higher quality, and improved profitability. Meanwhile, larger enterprises have proactively stepped up to assume self-disciplined responsibilities; as a result, the crude steel output from 20 major steelmakers—each producing over 10 million tons—fell by 3.7% year-on-year in the first half of this year, a decline steeper than the national average, effectively helping to stabilize the delicate balance between supply and demand."
The improvement in operational efficiency directly reflects the industry's commitment to adhering to the "Three Determinations and Three No's" while actively exploring a transformative development model. According to statistics from the China Iron and Steel Association, key enterprises achieved total profits of 95.982 billion yuan in the first three quarters of 2025, representing a year-on-year increase of 1.9 times. Moreover, monthly profits in June, July, and August all reached their highest levels since the same period in 2022.
While acknowledging the achievements, Jiang Wei pointed out the challenges facing the industry: "The pressure of supply-demand imbalance persists, and the industry continues to operate at razor-thin profit margins—any misstep could easily plunge companies into a costly downturn." Since September of this year, driven by expectations from the "Golden September and Silver October" period and related activities, corporate production intensity has significantly exceeded actual market demand. However, in September, apparent steel consumption actually declined by 6.7%, while infrastructure investment recorded its first-ever negative growth of -4.6%. This miscalculation led to a notable increase in key enterprises' steel inventories by 8.2% month-on-month and 7.8% year-on-year in early October, pushing social steel stocks to nearly four-year highs for the same period. At the same time Imported iron ore , the prices of raw fuels such as coking coal have risen, Steel prices The "scissors gap"—where indices continue to decline—led to a 32% month-on-month drop in profits for key enterprises in September, putting the profit gains of the first three quarters at risk of being eroded. Even more concerning is that, during the first half of October, crude steel production by key surveyed steel companies surged significantly by 7.5% compared to the previous ten-day period. Unfortunately, some enterprises still cling to the侥幸 mentality of "while others cut production, we’ll ramp up ours to dilute costs and keep competing fiercely," treating full-capacity output as a measure of success and low-price order acquisition as their go-to strategy. Currently Steel Market The current situation of soaring inventory levels and persistently low prices is precisely the consequence of this pattern: "individuals act shrewdly, while the collective ends up losing out."
"To win the final battle of 2025 and the close-out phase of the 14th Five-Year Plan, the entire industry must firmly strengthen self-discipline and consistently adhere to the 'Three Determinations and Three No's' approach." Jiang Wei emphasized that leading enterprises should take the initiative in controlling production and actively share their expertise, while the whole industry must deeply embed the principles of "production based on sales, efficiency, and cash flow" into its core business practices. He added, "We must avoid turning cash into inventory, refrain from engaging in chaotic, low-price competition, and steer clear of short-sighted decisions that compromise future growth—instead, we should truly uphold the values of 'honoring trust, practicing self-discipline, and following established rules.'"
The green response to the tough battle against ultra-low emissions earns recognition.
“Promoting the greening and decarbonization of economic and social development is a key component in achieving high-quality growth.” Jiang Wei quoted relevant remarks from the report of the 20th National Congress of the Communist Party of China, emphasizing that green and low-carbon practices are the core direction for the steel industry’s transformation. As a landmark project marking the industry’s green transition, the ultra-low emission retrofit initiative has made groundbreaking progress during the 14th Five-Year Plan period.
According to reports, thanks to the coordinated efforts of national ministries and commissions along with the proactive support from the China Iron and Steel Association, the steel industry's ultra-low emission transformation has been steadily advancing. As of the end of October 2025, a total of 219 steel enterprises across the country have either completed or partially completed their ultra-low emission upgrades and assessments, with 165 companies achieving full-process ultra-low emission upgrades, covering crude steel production capacity of approximately 663 million tons. Meanwhile, 55 enterprises have publicly announced partial-process ultra-low emission upgrades, involving crude steel capacity totaling around 188 million tons. To ensure the quality of these transformations, the Energy Conservation and Environmental Protection Committee has organized experts to conduct a cumulative total of 3,192 person-times in reviewing application documents—both formally and in terms of content. Additionally, the committee collaborated with the local steel industry associations from Shandong, Shanxi, Hebei provinces, as well as Tianjin Municipality and Jiangsu Province, jointly carrying out on-site verification and re-inspections for a total of 835 person-times.
The investment has yielded significant environmental benefits. Jiang Wei presented data showcasing the emission reduction achievements: Compared to the end of the 13th Five-Year Plan period, since the start of the 14th Five-Year Plan, industry-wide concentrations of particulate matter, sulfur dioxide, and nitrogen oxides have generally dropped by more than 50%. "In many leading enterprises, the organized emission concentrations of particulate matter, sulfur dioxide, and nitrogen oxides have remained consistently below 10 mg/m³, 35 mg/m³, and 50 mg/m³, respectively—levels far lower than the national standards." As a traditional major emitter, the steel industry's emission reductions have provided crucial support for improving air quality in key regions such as the Beijing-Tianjin-Hebei area and its surrounding regions, as well as the Yangtze River Delta. As a result, people across these areas are now enjoying noticeably more days with clear blue skies, white clouds, clean water, and lush green banks.
Ultimate energy efficiency unlocks potential, driving innovation to win the future.
Jiang Wei stated that achieving ultimate energy efficiency is currently the primary pathway for the industry to reduce carbon emissions, and the China Iron and Steel Association has firmly advanced the "Ultimate Energy Efficiency Project" as a foundational initiative for its low-carbon transformation.
Over the past three years, the China Iron and Steel Association has steadily expanded the demonstration effect of energy efficiency benchmarks, selecting 143 "Dual-Carbon Best Practice Energy Efficiency Benchmark Demonstration Enterprises" across four batches—companies that collectively represent an annual production capacity of approximately 750 million tons. As of mid-November 2025, 21 enterprises have already completed and publicly announced their achievement of cutting-edge energy efficiency standards. Among these, 10 companies were recognized as "Dual-Carbon Best Practice Energy Efficiency Benchmark Demonstration Enterprises," while 11 others were designated as "Dual-Carbon Best Practice Energy Efficiency Benchmark Demonstration Processes/Equipment." By the end of 2025, it is expected that 40 of the selected enterprises will meet the national benchmark level.
Benchmarking is driving the overall improvement of energy efficiency levels across the industry. Data from January to September 2025 show that key enterprises consumed a total of 264.0836 million tons of standard coal, representing a year-on-year decrease of 0.54%. Meanwhile, the benchmark energy consumption per ton of steel dropped to 481.05 kg of standard coal per ton, down 0.60% from the previous year. More significantly, the mandatory national standard GB 21256—2025, revised based on the industry’s cutting-edge energy efficiency group standards, has been officially released, marking the entry of steel energy efficiency management into a new phase of standardization.
Looking ahead, Jiang Wei stated: "Green and low-carbon development has now become the core challenge for the transformation and upgrading of the steel industry—and the only viable path toward achieving high-quality growth." He called on the entire industry to firmly commit to the "dual carbon" goals, leveraging innovation as the driving force to propel the steel sector toward a new era of green, low-carbon development.
“We firmly believe that the future of the steel industry will undoubtedly follow a path of energy conservation, environmental protection, and green, low-carbon development.” At the conclusion of his speech, Jiang Wei issued a call to action, urging industry colleagues to work together—driven by high-level ecological and environmental protection, as well as leading-edge energy efficiency standards—to achieve a win-win outcome of green, low-carbon transformation and steady economic growth. Together, they can contribute the power of the steel industry toward the comprehensive construction of a beautiful China and a socialist modernized nation.
