China’s steel sector still faces suffocating overcapacity. That’s despite effective results achieved through structural adjustments.

Li Xinchuang of the China Iron and Steel Association says overcapacity is, quoting now, "probably beyond our imagination." China has about 300 million tons of surplus steel output capacity and the sector suffers thin margins and increasing debt. The CISA expects that China’s annual steel output will slow this year but the overcapacity problems won’t be quickly solved.