China experienced a drastic jump in demand for its steel products in Iran, the United Arab Emirates and Syria as the Gulf countries spent "petrol dollars" on infrastructure construction, said UBS analyst Tang Xiaobo in a report on the country's steel industry.
In the first seven months, steel exports to Iran rocketed 22 fold to 2.3 million tons compared to the same period a year previous. The UAE increased 2.96 times to 1.3 million tons, and Syria by 6.59 times to 5 million tons, the UBS report said quoting Chinese customs data.
The surge in tonnage correlated with a drop in prices for steel exports to Gulf countries, as demand from the crude exporters was mainly for cheaper steel used in construction, such as reinforced steel bars, long steel and steel wire rods.
The new export trend has benefited China's private and smaller steel producers as larger domestic firms have turned away from products with low-added value.
The European Union, the Republic of Korea and the United States remained the three top foreign buyers of Chinese steel. In the first seven months, EU consumption rose 125 percent, while the U.S. was down 2.7 percent.
The country's economic planner, the National Development and Reform Commission, expressed its confidence in the development of the Chinese steel industry on Monday, saying the output growth was supported by rigid demand.
Chinese steel exports increased 73.2 percent to 49.52 million tons in the first nine months, according to a China Iron and Steel Association report.
Source:Xinhua
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