Nation's reform efforts in steel industry bear fruit

Thanks to the implementation of supply-side reforms, the pattern of supply and demand in the steel sector in China has improved since 2016, with steel companies' operational and financial situations improving and the sector entering a new stage of development, a recently released report said.

The profitability and debt levels of most steel companies in China have improved significantly compared with the situation before the supply-side reforms, said a credit analysis of steel sector issuers released by S&P Global (China) Ratings. The report was based on a sample of 24 steel companies since the implementation of the supply-side reforms.

While significant differences still exist between companies in terms of leverage, steel enterprises in China have looked to enhance their position and market share by continuously increasing scale and capacity in the past decade, it said.