CONF: China's stainless steel demand shows growth potential

Ningbo Baoxin Stainless Steel, a leading stainless steelmaker based in East China's Zhejiang, is a subsidiary of China Baowu Steel Group, the world's largest steelmaker.

Lin highlighted that China's per capita apparent consumption of stainless steel reached 22 kilograms in 2023, surpassing that of Japan (13.9 kg/person) and Germany (16.6 kg/person), but still lagging behind South Korea (30.1 kg/person) and Italy (33.8 kg/person). This gap indicates considerable room for growth in China's stainless steel demand, he told delegates.

Lin predicted that China's stainless demand during 2024 would rise by 6% year-on-year, bringing it to 32.95 million tonnes, and added that demand by 2028 had the potential to reach 41.2 million tonnes.

However, during in the first half of this year, China's stainless market faced difficulties, Lin conceded, with many producers struggling to remain profitable. He attributed this to intensified competition from a growing number of suppliers and rising raw material costs, which have offset the positive effects of perceived demand growth.

Lin also noted a trend where large end-use enterprises are increasingly sourcing directly from steel mills, reducing their participation in the retail market. This shift has contributed to the sluggish performance of the spot market for stainless steel.

But an official with a large home appliance manufacturer stressed that going direct benefited major buyers like her company. "Purchasing stainless products directly from steel mills allows us to avoid the price volatility of the spot market and makes it easier to ensure that product quality meets our standards," she told Mysteel Global on the conference sidelines.

To overcome these challenges, Lin stressed the importance of innovation and closer collaboration with end-user industries. As an example, he cited Taiyuan Iron and Steel Group's development of new nickel-based alloys that has provided high-quality domestic alternatives for Chinese aircraft manufacturers.

Written by Adele Pan, panqinjie@mysteel.com    

Edited by Russ McCulloch, russ.mcculloch@mysteel.com