Capacity cut makes China's steel shine

BEIJING, Feb 11 (Xinhua): China's steel industry posted higher prices and better profits last year as a result of progress made in reducing excessive capacity, according to the Ministry of Industry and Information Technology (MIIT).

The steel price index came in at 121.8 at the end of December, up 22.4 per cent from the beginning of 2017, the MIIT said.

It attributed the increase to cutting overcapacity, a ban on low-quality steel, production restrictions during winter, and recovering market demand.

China slashed its crude steel production capacity by more than 50 million tonnes in 2017, exceeding its annual target, as part of efforts to improve the competitiveness of the bloated sector.

The country also phased out the production of 140 million tonnes of low-quality steel made from scrap metal last year.

The industry's profitability improved, with major steel producers' profits surging 613.6 per cent, the MIIT cited data from the China Iron and Steel Association as saying.