ABARE's Forecast on China's Steel Output in 2011

China's crude steel output would be 674 million tons in 2011, a 7 percent increase from this year's 630 million tons, according to a report by the Australian Bureau of Agricultural and Resource Economics (ABARE).

Given the policy to curb the development of energy-intensive sectors and the slowdown in consumption, the growth rate of China's steel production this year would slide to just over 10 percent, ABARE said.

China would import 629 million tons of iron ore in 2011, an increase of 3.5 percent over this year, and import 45 million tons of metallurgical coal, slightly higher than this year's 44 million tons.

China's imports of iron ore will drop in 2010, thanks to increased output at home. But demand for ore from Australia and Brazil would remain strong due to the much lower iron contents of indigenous materials. Therefore, a continued fall in the imports of iron ore into China won't occur at least in the short run.

The report forecast the contract price of iron ore next year would be $123 per ton on average, down 6.5 percent from $132 this year; metallurgical coal price would be $220, up 2.4 percent.