Hunan, China (Platts)--24Apr2009

China's central government has plans to release revised regulations for
the newly approved revitalization plan for the steel industry, including those
for further industry consolidation, according to Jia Yinsong, a senior
official of the Ministry of Industry and Information Technology. Jia
was speaking at a press conference held by MIIT Thursday.

MIIT has already held meetings with related government departments in
preparation to map out new regulations for further consolidation in the steel
industry, Jia noted. Following the revitalization plan, local
provinces/municipalities, including Shandong and Tianjin, have already taken
action to encourage consolidation in the steel industry. Additionally, MIIT
will release detailed plans for local technological upgrade projects in May.

According to a release by MIIT Thursday, China's domestic steel demand
has yet to fully recover despite a slow recovery in the automobile and the
railroad industries. In light of the apparent overcapacity of around 100
million mt/year, Jia called on local steelmakers to strictly control their
steel output in line with domestic steel demand.

Encouraged by the central government's macro-investments, China's crude
steel output increased by 1.4% year on year to 127.44 million mt in the first
quarter of 2009, as Platts has reported. The country's finished steel output
in the same period also increased by 2.8% year on year to 144.73 million mt.
--Reggie Le, newsdesk@platts.com