Emphasis on eliminating inefficient capacities
CISA Vice President Xia Nong stressed the need to strictly prohibit the addition of new facilities, while promoting capacity decommissioning and phasing out obsolete, inefficient, high-emission facilities. He also called for the creation of a science-based long-term management mechanism to strengthen industry discipline and sustainable development management.
The strategy is in line with China's 15th Five-year Plan (2026-2030), which prioritizes capacity reduction, quality improvement, and industrial transformation. Key areas include improving product quality, improving energy efficiency and carbon emissions efficiency, and accelerating digital and intelligent manufacturing.
Supply and demand imbalance persists
Despite the decline in production, structural imbalances remain evident. According to official data, China's steel production fell 4.4 percent year-on-year to 961 million tons in 2025, while apparent consumption fell 7.1 percent to 829 million tons. At the same time, the output of finished steel increased by 3.1 percent to 1.45 billion tons, indicating continued production pressures.
Representatives of the Ministry of Industry and Information Technology stressed the need for coordinated action on both the supply and demand sides. On the supply side, efforts will focus on controlling new capacities and optimizing production, while demand-side measures aim to expand the use of steel and promote higher consumption.
There are noticeable changes in the structure of steel demand in China. In 2025, the manufacturing sector overtook construction as the largest consumer, accounting for 51 percent of demand, while the share of construction declined to 49 percent from 58 percent in 2020.
Globally, the World Steel Association noted that, although demand
