3.2.3.1 Availability and Consumption     

With the development of economic construction and national strength, the Chinese iron and steel industry is progressing at an unprecedented rate. In 1949, China produced meager 250,000 tons of iron and 158,000 tons of steel. In 1996, however, 107.21 million tons of pig iron and 101.24 million tons of steel were produced with annual growth rates of 13.8% and 14.7% respectively. In 1996 the total steel output topped 100 million tons for the first time, which surpassed Japan and leapt to the first place in the world.     

Iron ores are the major raw material for iron and steel smelting. The quantity and quality of iron ores are essential to the development of iron and steel industry. In the early days after the founding of the People's Republic of China in 1949, a number of iron mines were recovered or constructed, such as the Longyan Mine in Hebei, Gongchangling, Dagushan, Yintaoyuan (currently Qidashan) and Nanfen Mines in Liaoning, Qijiang Mine in Chongqing, Jinling Mine in Shandong, Liguo Mine in Jiangsu, and Shilu Mine in Hainan. The iron and steel industry was on a very small scale during that period and there were only 16 blast furnaces with a volume of more than 300 m3, which consumed a relatively small quantity of ores annually. At that time, mainly rich ores were mined, which can be directly used for smelting, so they could basically meet the demand. After 1957, China's iron and steel industry witnessed a rapid development, but the construction of mines were somewhat backward and brought about unbalance between supply and demand. Therefore, China had to import rich iron ores from abroad.     

From 1994~1997, China produced about 120~130 million tons of finished iron ores every year. Besides, 40~50 million tons of rich ores were imported annually. Thus, the domestic demand for iron ores can be basically satisfied. Table 3.2.6 shows the annual increase of imported rich iron ores and their proportion to domestic consumption.

Table 3.2.6 Consumption of iron ores and their sources from 1994~1997

3.2.3.2 Trends     

The iron and steel industry is one of the pillar industries of the national economy and it is even more important to China whose national economy is being developing at a high speed. The output of iron and steel is expected to reach 120 million tons by 2010 under conditions of further regulating the mix of iron and steel products, improving the quality of products, saving energy resources, lowering production costs, strengthening market competitiveness and increasing the output and variety of high-tech much-needed steel products such as steel plates, pipes and belts. Considering that one ton of pig iron corresponds to 1.9 tons of finished ores, 228 million tons of finished ores will be in need by 2010. It is estimated that the number of built and rebuilt mines will not be increased notably and moreover the currently operated mines tend to decrease their production (2~3 million tons annually). If the increased capacity is balanced out by the decreased capacity, the annual output of finished ores will still reach 130 million tons. Consequently the shortage of finished iron ores will be about 100 million tons by 2010.     

There are two approaches to solving this problem. One is to seek for and explore new bases of iron resources and the other is to further import iron resources from abroad.     

In regard to the first approach, the following two aspects should be focused. In the eastern part of the country, which has been intensively investigated, the stress should be placed on blind and concealed iron deposits; while in the western part, where less geological prospecting work has been conducted, seeking for new deposits is considered as an imperative task. On the other hand, it is important to make full use of large-sized idle deposits of poor ores, deposits of non-magnetic and complex ores, and deposits buried deeply or in complicated hydrological conditions.     

Because there are too many poor iron ores in China and lots of iron ores are difficult to mine and dress, it will be unchanged to import iron resources from foreign countries. Analysis shows that the proportion of imported ores to the domestic consumption might be increasing from 28.3% in 1997 to about 35% in 2010. Of course, the amount and manner of imports depend upon the situation of foreign resources and international markets.      

It should be mentioned at the end of this report that it is advisable to make effective use of waste iron and steel. The general tendency in the development of iron and steel industry is to use less pig iron and more waste steel. The rate of utilization of waste steel is over 40% or even 50% in such countries as the US, the UK, Germany, the former USSR and Japan. In China, however, this rate is only 20%~30%. With the development of the national economy, waste iron and steel will be increased tremendously in China, so the retrieval of waste iron and steel will be of great significance in reducing production costs, improving economic benefits and protecting environments. This is also an important approach to dealing with the unbalance between supply and demand of iron resources in China.