June 2009 | Steel Tracker
Chinese market gets up speed: Flat Product Analysis-China, Japan, Other Asia
It still looks likely that after maintaining constraints on production for months steelmakers will be too quick to raise output again.
All eyes of the world steel industry – not just those in Asia - remain focused on China. Its enormous stimulus package (equivalent to $585,000m) is already stoking up demand. The resulting boost to confidence among property developers is multiplying the effects through the economy helped by a relaxation in bank controls which has led lending to rise by around 30% above 2008 levels. The steel industry’s biggest customers, the construction and the carmaking industries, are in deep trouble elsewhere in the world, but they are thriving in China.
As the chart shows, investment in fixed assets follows a marked seasonal pattern in China, but it maintaining pre-recession growth rates, even accelerating. During the first five months this year the total was 33% higher than in the corresponding period last year, with the government stimulus responsible for most of the increase. The growth in property development has been...
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