By Bloomberg News
July 22 (Bloomberg) -- China, the world’s largest steel producing nation, should curtail “reckless investments” in the industry by withholding project approvals.
China’s demand for steel is about 500 million metric tons, less than the annual output capacity of 660 million tons, Zhu Hongren, spokesman for the Ministry of Industry & Information Technology, said at a conference in Beijing today. Zhu is reiterating figures given by the China Iron & Steel Association in February for last year.
Crude steel output in China rose to a record 266.6 million tons in the first half as the nation’s $586 billion stimulus package spurred demand from builders and carmakers. Annualized, this would beat the 460 million tons output forecast by the steel association for this year.
“The industry must produce according to market needs, and avoid adding to the excess capacity,” Zhu said. “They should avoid reckless investments. The government must also take action to curtail additional investments by companies that are already in excess.”
--Eugene Tang.Editors: Tan Hwee Ann, Indranil Ghosh.
To contact the Bloomberg News staff on this story: Eugene Tang in Beijing at eugenetang@bloomberg.net
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