SINGAPORE - Scepticism from steel industry participants has greeted the Chinese government's target of cutting the country's crude steel capacity to 400 million tpy within five years. China's existing crude steel capacity is about 470 million tpy, and is expected to reach 500 million tonnes by 2007, a Shanghai-based analyst noted. "It will be very difficult for the government to reduce the capacity to 400 million tpy, as the central government's commands are no longer as forceful as before," he said. "Market competition will not be sufficient to get rid of the excessive capacity." "Crude steel capacity is already over [400 million tpy], and even if [the NDRC] was referring to the actual output, it is a very conservative figure," said an official from the China Iron & Steel Assn (Cisa).
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