On April 28, 2026, in Beijing, a symposium attended by leaders from 20 leading and key steel enterprises, including China Baowu Steel Group, Ansteel Group, and Shougang Group, was held as scheduled under the organization of the China Iron and Steel Association (CISA). This First-Quarter Economic Operation Symposium for some steel enterprises was not only an in-depth review of the industry’s performance over the past three months but also a collective assessment of the current complex and severe situation, along with proactive planning for future paths. The meeting sent a clear signal: against the backdrop of market demand falling short of expectations and unprecedented profit pressure, the entire industry is forging a strong consensus to be “rational and pragmatic, self-disciplined and collaborative, and seek change internally,” jointly exploring a new path of high-quality development focused on “reducing volume while optimizing, enhancing quality and efficiency.”
I. Deep-Seated Concerns Beneath Stable Operations: The Contradiction Between Strong Supply and Weak Demand Remains Prominent
The meeting began by reviewing the industry’s performance in the first quarter. A CISA official reported that despite complex internal and external challenges, the steel industry achieved overall stable operations in the first quarter. Crude steel output declined modestly, and while steel exports fell from last year’s highs, they remained at a considerable scale. Enterprises actively implemented the operating principle of “production based on sales, based on efficiency, and based on cash flow” (the “Three Determinations and Three Don’ts”), demonstrating a strong awareness of risk response.
However, beneath this “stability” lies a severe reality of multiple accumulating pressures. Tang Zujun, Standing Committee Member of the Party Committee and Vice President of CISA, accurately summarized the current operational characteristics of the industry in his concluding remarks: “The situation of strong supply and weak demand has not changed; steel prices remain persistently low; inventories are higher than the same period last year; and profitability in the main steel business is relatively weak.” Participating enterprises generally reported that market demand continues to fall short of expectations, recovery in traditional steel-consuming sectors such as real estate remains slow, and growth in emerging steel-using sectors is not yet sufficient to fully offset the shortfall. Meanwhile, the prices of major raw materials and fuels, including iron ore and coking coal, remain high, continuously eroding already thin profit margins. Data show that the main business profit of the steel industry in the first quarter declined significantly year-on-year.
“Only by resolving the main contradiction of strong supply and weak demand can the industry truly achieve a virtuous cycle and reach a state of stable operation,” Tang Zujun emphasized. This assessment has become a common consensus among participating enterprises. They clearly recognize that in today’s increasingly buyer-driven market, blind optimism or hopes for a rapid rebound in demand are unrealistic. The industry’s primary task remains “protecting profitability,” and the source of profitability lies in achieving a dynamic balance between supply and demand.
II. Building Industry Consensus: Disciplined Production Control and Jointly Maintaining Market Order Are Key
Faced with severe challenges, should enterprises fight independently and fall into a “prisoner’s dilemma” of low-price competition, or should they work together and maintain a healthy ecosystem through “collective rationality”? The discussions at this symposium provided a clear answer.
After in-depth analysis, participating enterprises concluded that the high inventory levels in the current steel market are an urgent risk to be resolved, and the enormous destocking pressure directly suppresses market prices. Therefore, adhering to disciplined production control and inventory reduction is the most urgent and effective strategy at present. This is not only a survival strategy for individual enterprises but also a responsibility to the overall interests of the industry. The meeting called on the entire industry to maintain strategic focus, continue to fully implement the “Three Determinations and Three Don’ts” principle, and scientifically plan production based on actual market demand, avoiding unnecessary capacity releases that would exacerbate supply-demand imbalances.
In addition to output discipline, maintaining a healthy market price order became another focal point of the meeting. Vice President Tang Zujun revealed that CISA is currently advancing the work of steel industry price supervisors, aiming to collaborate with enterprises to establish more effective self-discipline and oversight mechanisms, jointly fostering a healthy industry ecosystem and resolutely avoiding vicious, disorderly competition. This initiative indicates that industry self-discipline is moving from conceptual advocacy to a new phase of institutionalization and systematization. Combating practices such as “low-price dumping” that disrupt market order, and maintaining the reasonable value of steel products, has become a core task promoted by top industry management.
III. Charting the Future Direction: Embracing the “Five Transformations” and Moving Toward High-Quality Development
The symposium was not only focused on solving immediate “survival” issues but also provided profound insights into the medium- and long-term development trends and transformation paths of the industry. Vice President Tang Zujun clearly stated that China’s steel industry has entered a new development stage characterized by “reducing production volume while optimizing existing capacity” and is undergoing five historic and profound transformations:
Shift in development logic: from scale expansion to volume reduction and optimization.
Shift in market position: from a seller’s market to a buyer’s market.
Shift in production methods: from traditional manufacturing to green and smart manufacturing.
Shift in product structure: from construction steel-dominated to manufacturing steel-dominated.
Shift in business models: from production-oriented to production-service-oriented.
To actively adapt to and lead these transformations, the meeting offered systematic recommendations for high-quality development:
First, strategically, enterprises must “do some things and refrain from others.” Facing the “15th Five-Year Plan” period, seen as a crucial “revolutionary phase” of profound industry change, enterprises must reassess their positioning. They should closely track the upgrading demands of downstream high-end manufacturing, promptly adjust and optimize product structures, focus on “specialization, precision, and uniqueness,” and build distinct competitive advantages in differentiated products and niche markets to escape the trap of homogenized competition.
Second, the core of competition must shift from “price” to “value.” The meeting noted that industry competition has fully upgraded to a comprehensive contest of quality, brand, and service. Enterprises must prioritize optimizing product variety, strictly controlling product quality, and strengthening brand building. At the same time, they should embrace the concept of “total factor cost reduction and efficiency enhancement,” exploring cost-saving potential through multidimensional innovations in management, technology, finance, and logistics, while creating new profit growth points by extending the service value chain. “The industry needs high quality, high technology, and high standards, but the starting point and ultimate goal must be high efficiency. Only with efficiency can there be a future,” Tang Zujun emphasized.
Finally, the bottom line of risk prevention must be reinforced. During the current period of adjustment and transformation, various risks are prone to occur, with cash flow risk being the most direct and fatal threat in the short term. Enterprises need to strengthen risk awareness and bottom-line thinking, strictly control debt levels, accelerate accounts receivable turnover, rigorously manage inventory buildup, avoid “using short-term loans for long-term investments,” ensure cash flow security, and reserve sufficient “ammunition” to cope with potential market fluctuations.
The First-Quarter Economic Operation Symposium acted as a mirror, reflecting both the pressures and challenges of the steel industry during its painful transformation and the determination and wisdom of the entire industry to build consensus amid crisis and seek breakthroughs under pressure. Saying goodbye to the era of purely pursuing scale and embarking on a new journey centered on quality, efficiency, and core competitiveness has become an irreversible trend.
Currently, the giant ship of the steel industry is sailing on a waterway full of waves but with a clear direction. By maintaining market stability through firm self-discipline in production control, embracing downstream changes through deep structural adjustments, driving green and smart transformation through relentless technological innovation, and protecting the competitive ecosystem through shared industry self-discipline, China’s steel industry will undoubtedly forge more sustainable, higher-quality, and stronger international competitiveness through the tempering of “reducing volume while optimizing, enhancing quality and efficiency.” This transformation path is bound to be challenging, but the rationality, pragmatism, and collaboration demonstrated at this symposium are undoubtedly the most solid foundation for future success.
