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China Steel Boom Continues

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BEIJING, China (December 14) -A BEIJING man this week got 30,000 Yuan (USD. 5000) in compensation after he fell into an open manhole and broke his leg. He was a victim of the sky-high scrap metal prices occasioned by China’s steel boom. The missing manholes were among 21,090 reported stolen in the capital in the […]

BEIJING, China (December 14) -A BEIJING man this week got 30,000 Yuan (USD. 5000) in compensation after he fell into an open manhole and broke his leg.
He was a victim of the sky-high scrap metal prices occasioned by China’s steel boom. The missing manholes were among 21,090 reported stolen in the capital in the first 10 months of this year for resale to underground dealers.

The steel boom has left suppliers gasping. China now consumes more than a quarter of the world’s steel. It’s the world’s biggest consumer, producer and importer. Output has nearly tripled since 1998 and now exceeds that of the US and Japan combined. Fortune Magazine just named Xie Qihua, president of China’s biggest steel company, Baosteel, as the world’s second most powerful businesswoman.

Australian iron ore exports to China grew 11% to $1.7 billion in the year to June 2004. The figure might have been much greater, if only the capacity had been there – China’s total iron ore imports have risen an estimated 79% in the past two years, and a 158 % increase in the average China price paid for iron ore imports will have its effects too…

As the new wealth filters into the, until now lagging behind, countryside, 800 million farmers will be buying not just new houses but TVs, air-conditioners, bicycles, cars, tractors and trucks.
By 2010, China will quadruple its shipbuilding capacity, by which time it will be the second biggest car producer in the world, after the US. On top of the roads, bridges, ports and railroads necessary to development – 27,000km of new railroads are planned by 2020 – there are huge projects such as the 2008 Beijing Olympics (planned investment $US16 billion) and the Shanghai Expo 2010 ($US3-4 billion).

If iron ore consumption and steel production can still be seen as the perfect barometer for economic health, than China’s growth has long, long legs…

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