Zhang Haideng: The next step will be to conduct research on issues affecting the high-quality development of the industry

China Metallurgical News, China Iron and Steel News Network

Reporter Zhao Ping reports

Reporter Gu Xuechao photography

"There are no bystanders to reform, and each of us has a responsibility, especially all of us here." On July 31, Zhang Haideng, deputy director of the Department of Raw Materials Industry of the Ministry of Industry and Information Technology, revealed in a speech at the eighth (expanded) meeting of the sixth session of the China Iron and Steel Association that the next step will be to study the pain points and difficult issues such as layout planning issues that affect the high-quality development of the industry, precise classification management of long and short process steelmaking, capacity governance, market disorderly competition, life and property safety, scientific and technological innovation and industrial innovation integration, and standard implementation, and promote the implementation and solution.

The picture shows Zhang Haiden

He pointed out that at present, the development of the steel industry has entered a new round of adjustment cycle, the development conditions and development situation have undergone great changes, and the deep-seated problems restricting the development of the industry have not been solved. However, the steel industry has shown full resilience after supply-side structural reform. At the meeting, he expressed his views on the current development of the industry, the confidence and opportunities for the development of the industry, and the current and future work that needs to be promoted.

The industry is still not out of the predicament and is facing great challenges

Zhang Haideng said that in the first half of this year, the mainland steel industry has not yet come out of the predicament since 2022, and continues to face difficulties such as market downturn, falling demand, falling prices, and declining efficiency.

On the one hand, the total steel consumption in the mainland has declined, and the actual consumption (excluding duplicate materials) has declined for three consecutive years since reaching a peak of 995 million tons in 2020, reaching 479 million tons in the first half of this year, a year-on-year decrease of 15.9 million tons. How to stabilize operation, stabilize growth, adjust structure, and promote upgrading in the downward market has posed great challenges to the industry.

On the other hand, the development conditions and development situation of the industry have also undergone great changes, and the deep-seated problems restricting the development of the industry have not yet been solved.

First, the concept of development has not changed. In the face of the development trend of declining downstream demand, the inertial thinking of the industry to win by quantity has not been completely reversed. Some companies are still hoping to continue to expand steel exports to maintain domestic production scale, and some companies are still looking around to expand production capacity. In particular, he noted that this model is not sustainable for the time being.

Second, the order of the industry needs to be improved. At present, it is difficult for industry self-discipline to be effectively played, and market competition is becoming increasingly fierce. He pointed out that the concentration of the mainland steel industry is still at a low level, and the concentration of the top 10 steel enterprises is only 42%, which is still a certain gap compared with European and United States, Japan, Korea, etc., as well as domestic automobile, cement and other industries.

Third, the resource base is still weak. 90% of the mainland's steel production capacity is a long-term process, and the demand for iron ore and imports have remained high for a long time. Since 2016, the import volume of iron ore has exceeded 1 billion tons for 8 consecutive years, and the external mining degree has basically remained above 80%, and the average import price in 2023 will be 113.6 US dollars / ton. At the same time, scrap resources are not fully utilized, and the security of the industrial chain and supply chain continues to face challenges.

The development of the industry should strengthen confidence and seize opportunities

Zhang Haideng said that after years of development, especially by vigorously promoting the supply-side structural reform, the mainland steel industry has formed a complete industrial chain, with mature design, construction, production, operation and related supporting capabilities, high-end, green and intelligent development has achieved remarkable results, and has also received international praise. He pointed out that the development of the steel industry should strengthen confidence and seize opportunities. Specifically, there are four main aspects.

First, the Party Central Committee and the State Council attach great importance to the development of the manufacturing industry. General Secretary Xi Jinping attaches great importance to the development of the steel industry, and has made many important instructions, such as General Secretary Xi Jinping in his reply to the professors of the University of Science and Technology Beijing, emphasizing the need to promote the innovative development of the steel industry, green and low-carbon development.

He particularly emphasized that the steel industry is an advantageous industry and a competitive industry, and it is necessary to pay attention not to involute. This year's steel exports are the highest in the same period in history, but the profits are not considerable, which needs to be noted. He also revealed that in the next step, in accordance with the spirit of the Third Plenary Session of the 20th Central Committee of the Communist Party of China, we will improve the system and mechanism and promote the further implementation of relevant policies and measures for the high-quality development of the manufacturing industry, including the steel industry.

Second, the steel industry has a good foundation for high-quality development. The iron and steel industry is an important traditional manufacturing industry in mainland China, with industrial added value accounting for more than 5% of the country's total, annual apparent consumption of more than 900 million tons, and a wide range of social influence. Although the current industry efficiency is declining, there is a good foundation for long-term development, the overall asset situation of the industry is still at a good level, and the industrial competitiveness is still strong. Especially in recent years, with the continuous advancement of supply-side structural reform, the high-end, intelligent and green development level of the industry has been significantly improved, which has also laid a good foundation for the next high-quality development of the industry.

Third, the steel industry has a huge downstream market. The mainland is the safest and most stable country in the world, and it is also the largest single market in the world, forming a market that can be completely internal circulation. First of all, there is great potential for infrastructure construction, for example, the infrastructure built in the fifties and sixties is facing transformation and upgrading, and the rural infrastructure needs to be vigorously developed. Secondly, the growth of steel in the manufacturing industry is obvious, and emerging industries such as new energy, new materials, and high-end equipment have driven the development of high-end steel. Finally, the promotion and application of steel structure buildings have broad prospects, and the proportion of steel structure housing and related applications in mainland China is low. According to the prediction of the Steel Association and other units, the promotion of steel structure buildings in the mainland can increase steel consumption by 10 million tons per year.

Fourth, the steel industry has created a number of strong enterprises, entrepreneurs and experts. He said that as long as all parties in the steel industry unite to take the road of high-quality development, they are fully confident and capable, and the key lies in the enterprise itself. He also revealed that the next step will be to focus on the "market failure" issue raised by the Third Plenary Session of the 20th Central Committee.

The next step is to do a good job in five aspects

Regarding the current and future work that needs to be promoted, Zhang Haideng pointed out that in the face of complex situations and arduous challenges, the steel industry should resolutely implement the deployment of the 20th National Congress of the Communist Party of China and the 20th Central Committee of the 20th Central Committee and the Third Plenary Session of the 20th Central Committee.

First, it is necessary to grasp the implementation of the tasks of the Third Plenary Session of the 20th CPC Central Committee. The Third Plenary Session of the 20th Central Committee of the Communist Party of China (CPC) made systematic arrangements for further deepening reform in an all-round way, with a focus on modernizing the country's governance system and capacity. Zhang Haideng said that the next step will be to increase research on the pain points and difficult problems of the industry, such as the problem of industry layout planning, the problem of smooth green transportation, how to adapt to the development requirements of the new situation with capacity replacement, how to strengthen supervision for the statistical differences between "on-balance-sheet" and "off-balance-sheet", and how to regulate disorderly competition in the market. He suggested that iron and steel enterprises should study the current problems in depth, and put forward opinions and suggestions to reflect upward. "Problems that enterprises can't solve, our government studies and solves. Together, we will work together to achieve the overall goal of further deepening reform in an all-round way. He said.

Second, we must adhere to the "six-type" development direction. First, adhere to quality and efficiency development. "No benefits are equal to no development, there is no sustainability, let alone high-quality development." He said that the next step will be to promote the implementation of relevant policies and norms in an all-round and systematic manner in accordance with the spirit of the Third Plenary Session of the 20th Central Committee, so that enterprises can achieve effective development. The second is to adhere to the balanced development of supply and demand. We will resolutely put an end to quantitative expansion-oriented development, promote the formation of a dynamic balance of "demand drives supply, and supply creates demand", and consolidate the achievements of supply-side reform. The third is to adhere to innovation-driven development. We must conscientiously grasp the integrated development of scientific and technological innovation and industrial innovation, break through a number of key processes and materials, and lay out a number of cutting-edge materials in advance for the future, so as to achieve global parallel or leading. Fourth, adhere to green and low-carbon development. Promote the energy consumption quota of key enterprises to reach the advanced value level, and new projects to reach the level of environmental protection performance A. Fifth, adhere to the integration of digital and real development. Accelerate the in-depth application of digital technology in R&D and design, manufacturing, operation and management, and market services. Sixth, adhere to safe and efficient development. Coordinate the shortcomings of the board, elongate the board, and forge the new board, prevent and resolve major risks, enhance the independent and controllable ability of mineral resources, key materials, and core process technologies, and greatly improve the intrinsic safety level of the industry. He also reminded that attention must be paid to strengthening data security protection.

The third is to strengthen industry self-discipline and create a good environment for industrial development. He pointed out that iron and steel enterprises should prevent unfair competition and avoid vicious competition, and the enterprises present should effectively play a leading and exemplary role. The imbalance between supply and demand is the biggest challenge facing the industry today. This year, the relevant requirements for crude steel production have been clarified, and the key is to implement them to all enterprises in the industry. We must continue to enhance the consciousness of strictly prohibiting new steel production capacity, strictly abide by relevant regulations, and do a good job in technological transformation and project construction in accordance with laws and regulations.

"In order to maintain the benign and orderly development of the steel industry, in addition to the introduction of relevant regulations, it will also play a good role in the supervision of the people." He revealed that in the next step, the Ministry of Industry and Information Technology will take the revision of the "Standard Conditions for the Iron and Steel Industry" as the starting point to cultivate a number of leading standardized enterprises and provide enterprise development samples for the whole industry.

Fourth, overcome difficulties and pay close attention to the implementation of key tasks. Including building a solid foundation for development, conscientiously implementing the steady growth plan of the steel industry, and striving to promote the smooth operation of the industry; Enhance the momentum of development, continue to do a good job in scientific and technological innovation, and accelerate the realization of high-level scientific and technological self-reliance and self-reliance; Improve the level of intelligent manufacturing, implement the "Implementation Guide for Digital Transformation of the Iron and Steel Industry", and deeply integrate the new generation of information technology with the steel industry to realize the intelligent transformation of the steel industry; Adhere to green development, promote ultra-low emission transformation and energy efficiency improvement as planned, orderly promote the development of short-process steelmaking in electric furnaces, and further promote pollution reduction and carbon reduction in long-process iron and steel enterprises.

Fifth, strengthen the foundation of resource security. Actively do a good job in the protection of iron ore resources, "international diversification, domestic production, scrap recycling" three articles, while increasing the development of domestic iron ore resources, promote the acceleration of the revision of the "recycled steel raw material standards", encourage the expansion of recycled steel raw material imports.