China largest steel producer, Hebei Iron & Steel located in China’s northern Hebei province, said today that it expanded its production by 26% year-over-year during the first half of 2010 to 23.68.
Its current six-month run rate puts its full year production at 47.36 million tons per year, which is ahead of China’s second largest producer Baosteel which is running at a 45.16 million tons per annum run rate. (22.48 million tons in the first half of 2010 so far)
To put the size of these companies’ output in perspective, total steel production for the entire United States was just 16.5 million tons in the first six months of 2010 according to the Iron & Steel Statistics Bureau.
Thus Hebei’s 26% production increase is enormous, yet production expansion is less of a worry for China’s largest producer given that the government is trying to force its splintered steel industry to consolidate around the largest players. The little guys are the ones who have to worry, while it’s probably safe to say that in the eyes of the Chinese government leading steel players such as Hebei or Boasteel are ‘too big to fail’.