Steel Demand Surge in China’s Manufacturing Sector: A Look into 2024 and Beyond
In 2024, the steel consumption in China’s manufacturing industry has seen a substantial increase, rising to 50% of the country’s total steel usage, up from 42% in 2020. According to Yao Lin, the head of the China Iron and Steel Association (CISA), the rise in steel demand is largely driven by the country’s booming new energy and new infrastructure sectors, which have fueled significant growth in both steel consumption and production.
The Shift Towards High-End and Specialty Steel Products
Steel companies in China have been quick to adjust to the evolving demands of the industry by improving their product portfolios. They have been increasing their focus on high-end and specialty steel products, which are crucial for advanced manufacturing, construction machinery, and mining equipment. These products are essential for the country’s infrastructure push, including projects related to renewable energy, electric vehicles, and high-speed rail systems.
Yao highlighted that, as China moves towards a more technologically advanced and sustainable manufacturing environment, the emphasis is on quality rather than quantity. This includes a shift toward high-strength steel to support the manufacturing of large-scale equipment and machinery required for heavy industries.
Steel Demand in 2025: A Continued Growth Trajectory
Looking ahead to 2025, steel demand in the manufacturing sector is expected to continue on its growth trajectory. A significant driver of this demand will be large-scale equipment renewals and trade-ins of consumer goods. As industries upgrade their machinery and infrastructure, the demand for steel to build and replace these components will increase. Additionally, the growing shift toward green energy technologies will also be a key contributor to steel consumption.
For instance, in sectors like construction machinery and mining equipment, demand for high-strength steel is anticipated to rebound, especially as new projects and technological advancements create more complex structural needs. This indicates a robust future for both general-purpose and specialty steel products in key sectors of the Chinese economy.
Strengthening Industry Collaboration for Future Growth
Yao Lin emphasized the importance of deeper cooperation between steel producers and key downstream industries, such as construction, shipbuilding, and transportation. These industries play a critical role in driving the demand for steel, and enhanced cooperation will be crucial for ensuring that the right steel products are available to meet the needs of these sectors.
In particular, industries like shipbuilding and transportation are expected to require customized steel solutions that meet rigorous safety, durability, and performance standards. With the global push toward sustainable infrastructure, the demand for high-performance and eco-friendly steel products will continue to rise, further driving China’s steel industry towards innovation and expansion.
A Growing Focus on Sustainability in Steel Production
As demand for specialized steel grows, there is also a rising focus on sustainability in steel production. China’s steel industry is responding to the growing calls for green manufacturing by adopting low-carbon technologies and improving the energy efficiency of steel production processes. This aligns with the country’s broader environmental goals and its ambition to become a leader in sustainable manufacturing.
