The economic slowdown, caused largely by China itself, weighed heavily on the Chinese steel industry. During the period January to November of 2015, China’s major steel firms saw a loss of US$11.6 billion.

The chairman of China Iron and Steel Association (CISA), Zhang Guangning revealed that the total annual crude steel capacity is now 1.2 billion tonnes. These record highs in steel production are coming in the wake of drastically reduced steel prices, and Mr Zhang lamented the lack of a mechanism to allow steel enterprises to exit the market.

“Some enterprises want to exit, but an exit route has not been opened up and some local governments continue to urge steel firms to produce in the interests of local economic development and safety.” said Mr Zhang.

CISA, which constitutes around 100 steel mills, and accounts for nearly 80 percent of total steel output, saw more than half of their members making losses in 2015. Mr Zhang pointed to the failure of steel output reductions to keep up with the fall in steel demand as a major contributory cause of the losses.

The result has been a stronger push towards exports, leading to a global market influx of cheap Chinese steel. The effect has already been evident in countries like Britain, where the steel industry, unable to compete with the Chinese steel prices, is tethering on the verge of collapse. While other countries such as India has implemented protectionist measures in a bid to protect their domestic steel producers.