Reuters reported that Chinese steel output which hit 779 million tonnes in 2013 is now close to its peak with the market weakening and the government now determined to tackle a capacity glut responsible for mounting debts and heavy pollution.

Mr Zhang Wuzong, a delegate at the National People's Congress and chairman of private steelmaker Shandong Shiheng Special Steel, said there is no room for further expansion. He said “You can basically say that Chinese steel output has reached a peak.”

Mr Deng Qilin chairman of Wuhan Iron and Steel (Wugang) and an NPC delegate said that “Capacity is now more than enough, with supply heavily outstripping demand and failing mills under pressure from both the government and the market. I can tell you that the steel industry, globally and in China, is facing a big, big imbalance of supply and demand it is facing serious overcapacity and if we don't control it the industry at home and overseas will fall further into a deep winter. Expanding further is meaningless if you are making losses, having more capacity will lead to even more losses."