China Steel- Now & Then

Xian, China

When you think of steel, you should be keeping an eye on China. China’s steel industry produces 50% of the world’s steel. They also demand the most of any other country. After the opening of China’s economy in 1978, demand for steel has been nonstop. Building infrastructure, cities, cars, apartments, factories, and more, China has an insatiable need for steel. The middle class is growing, and so is their income. This has lead to large demand for automobiles in a country where just a few decades ago many people were riding bicycles. The amount of cars on the roads in some major cities has caused havoc. So much so, that some cities institute rules about when people can drive. Certain license plate numbers can drive on specific days, which is implemented to help reduce traffic. China holds the title as having the largest automotive industry. Production of cars in 2009 exceeded that of the European Union, or of Japan and the United States combined.

During the period before China’s economic revolution, steel was hard to come by. During Chairman Mao’s reign, he determined that steel production was key to the economy. He decided (rather arbitrarily) to double steel production in one year through backyard steel furnaces. Citizens were required to throw their scrap metal like pots, pans, etc, into the furnaces. These furnaces produced low quality iron and steel. Eventually Mao and his cohorts visited large factories in nearby Manchuria and found that high quality steel was being produced. They stopped with program soon after.

Though capitalism has crept into China, many steel groups are still state-owned. It is strange to think of a time when China’s steel industry was behind the rest of the world. They are now a powerhouse in terms of manufacturing. It will be interesting to keep an eye on the Middle Country for the next few decades as their population and middle class continues to grow and expand. New cities are popping up throughout the country, especially in the west where there is more land. And as these cities grow, more steel will be needed.

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