Steel industry consolidation

As we all know, the iron and steel industry is the foundation of national industry, iron ore is the main raw material of the black steel pipe industry. At present, China’s foreign iron ore degree of dependency has reached above 80%, which is the soft and risk point of our iron and steel industry development. For some time, iron ore has been the “killer app” used by foreign mining giants to overcharge Chinese companies because of the need for massive imports.

It is known that after years of operation, AngANG Group Mining company has iron ore resources in Liaoning, Sichuan and Australia, with a scale of 8.8 billion tons. It is the iron and steel enterprise with the most resources advantage in China, and has a strong iron ore international trade capacity. The company has an annual stripping capacity of 280 million tons and an annual mineral processing capacity of 65 million tons. Overseas bases have an annual capacity of 8 million tons. Bengang also has reserves of 1.05 billion tons of iron ore, with an annual production capacity of 25 million tons of iron ore, 8 million tons of iron concentrate and 2 million tons of pellets.

As such, the restructuring of the two major iron and steel pipe manufacturers to reduce the significance of foreign iron ore dependence is self-evident, the relevant experts also expressed a high degree of affirmation. According to a member of the Chinese Academy of Engineering, the reorganization will effectively reduce the company’s dependence on imported iron ore by giving full play to its advanced mining and beneficiation technology advantages and mine construction capabilities. Vice President of the China iron and steel association, said saddle rich iron ore resources in the region of the future in such aspects as resource exploration, mining construction unified planning, will further improve its self-sufficiency rate of iron ore production and domestic, to really play a important role in domestic round steel pipe resources.

Faced with the pressure of carbon reduction in the steel industry especially for the production of conduit pipe, the restructuring of steel enterprises is conducive to the unification of carbon reduction measures, accelerate the progress of the supervision and rectification of carbon emissions, and help to achieve the national goal of “carbon neutrality and carbon peak”. Therefore, since 2019, China’s steel industry has accelerated a new round of mergers and reorganization. In July this year, China Baowu and Shansteel Group confirmed restructuring, coupled with the restructuring of Anshan Steel and Bensteel, the pace of central and local state-owned enterprises restructuring has been significantly accelerated, and the concentration of the steel industry has been effectively improved.