Steel Price News from MEPS (International) Ltd.
  Home Company Profile Steel Industry Analysis Meps Publications Consultancy Independent Studies
 
MEPS Steel Prices On-line MEPS Steel Reports On-line MEPS Industrial Sector Steel Price Index

Company Profile
Steel Industry Analysis
MEPS Steel Publications
Steel Consultancy
MEPS World Steel Prices
Independent Studies
Request Free Publications
Steel Statistics
MEPS Index Steel Prices
Subscribe to Publications
MEPS Steel News
Industry News
MEPS Sponsored Events
Steel Links
Subscription Rates
Add Link To Website
Content for Websites
Contact Us
Site Map
 
Home > MEPS Steel News - 04.09.2014

MORE EVIDENCE OF MEPS CLAIM THAT CHINA’S STEEL OUTPUT IS UNDERSTATED

In 2011, MEPS reported its belief that the National Bureau of Statistics figures for China’s crude steel production understated the actual output by approximately 6 percent. This fact was subsequently acknowledged by a senior member of the China Iron and Steel Association but no action appears to have been taken in the interim to change the situation.

Recently, Mr Xu Lejiang , Chairman of Baosteel Group, is reported to have stated that China’s crude steel production, in 2013, was 822 million tonnes. This was further reinforced in a recently published article by Mysteel, that an unnamed source had disclosed that up to 70 million tonnes of steelmaking capacity is unreported. By contrast, the latest figure issued by the country’s National Bureau of Statistics is 785 million tonnes.

Mr Xu’s assessment of crude steel output, in 2013, is broadly in line with MEPS latest calculated minimum figure of 815 million tonnes, published in the latest issue of MEPS CHINA STEEL REVIEW. Perhaps the disclosures from the two local steel sector experts will generate action from the authorities responsible for providing production statistics for the steel industry in China.

It is not satisfactory to have doubts about the accuracy of steel production statistics – particularly, for a country as large as China’s with its importance to the global mining sector and steel supply. Moreover, how can the authorities make meaningful decisions about investment, rationalisation, emissions control, privatisation issues etc for an industry in which there is no consensus about the most basic statistic – the level of output?

It is even more surprising when one considers the amount of analysis that takes place, almost on a daily basis, about the industry. Production from a part of the industry is reported three times every month. Percentage changes are analysed to two decimal places and the results reported in the press.

Steel prices are collected and published daily by a number of different organisations. We see futures contracts for steel products and raw materials. All this activity takes place with no concern for the accuracy of the industry’s production data.

Why do the authorities allow this situation to continue? MEPS highlighted the problem three years ago. It has now been confirmed by two steel industry insiders. It is not surprising that the sector was allowed to over-invest in steel manufacturing when the authorities fail to monitor accurately the size of a key matrix - the country’s output.


 

Source: MEPS China Steel Review - August Edition

Also See: www.worldsteelnews.com
 

Sign up for free MEPS steel news alerts

Enter e-mail address *Required

Name:      


Company: 
If you are a journalist please tick here: