China Shifts Steel Strategy: From Expansion to Quality-Focused Production

China’s Steel Industry Prioritizes Quality Over Quantity

China is intensifying its efforts to regulate steel production as demand slows and the market becomes increasingly saturated. At a recent quarterly briefing, the China Iron and Steel Association (CISA) emphasized the urgent need to shift from output growth to quality improvement.

Wang Bin, Director of Planning and Development at CISA, stressed that strict production controls remain crucial. These measures aim to stabilize the steel industry by balancing supply with actual demand, especially when no better market mechanisms exist.

New Regulatory Strategy Focuses on Sustainability

Wang urged the steel sector to transition toward high-quality development. This includes using environmental indicators, carbon emissions, and energy efficiency as benchmarks for production control.

CISA advocates for a performance-based evaluation system. It would ensure that advanced, efficient facilities receive support and outdated operations gradually shut down. These steps would enhance competitiveness and sustainability in China’s steel industry.

In early 2025, China released updated regulatory standards. These include changes to the steel capacity exchange system. The Ministry of Industry and Information Technology previously suspended the old scheme, citing misuse and speculation.

Industry Consolidation and Market Balance

Wang also called for a ban on exchanging production capacity between unrelated companies to curb speculative trading. Instead, he supports integrating capacities through large-scale mergers and acquisitions. This strategy aims to reduce overcapacity by eliminating redundant producers.

the National Development and Reform Commission (NDRC) announced plans to cut steel production in March 2025. While no exact numbers were given, market sources expect annual reductions of up to 50 million tons.

The shift from growth to quality in China’s steel sector reflects a broader commitment to industrial modernization and environmental responsibility. For more insights, visit SuperMetalPrice, your trusted source for global metal market news and analysis.