China’s Steel Industry in Crisis – Rest of Market on High Alert
The steel industry is not just experiencing problems on the domestic front – the market is taking big hits worldwide. Now the largest sector of the steel industry, which is China, is in crisis – something the rest of the world cannot ignore. Despite efforts by policymakers to reform the struggling industry, the market is getting worse and it is doing so at alarming speeds. br> br>
The problems within the Chinese steel industry are not related to a single factor but instead are due to a number of different elements. The steep decline is being credited to the slowing economy in China, falling commodity prices and a market that is riddled with debt. br> br>
As China transitions from a country booming in its property, construction and manufacturing sectors to a country more focused on technology and banking – it is hard to keep up. These new business are rising slowly as the older sectors fade out quickly – resulting in a major void for the country. br> br>
The entire steel industry is at risk due to the demand collapse in China. Steel prices hit a new low in July and large steel mills are losing billions of dollars as they try to stay on top of the competition. Now China officials must decide to help support the failing industry or let the companies affected collapse due to their accumulated debt.