The Global Iron and Steel Industry: From a Bilateral Oligopoly to a Thwarted Monopsony

Abstract

China's growing urbanisation and the speed of development of its manufacturing industry has led to a shock in steel demand. This article analyses the evolution of the market structure and the related market power shift. From a stable situation in which a few steelmakers negotiated with a few mining firms to set an annual price, the market has evolved to a new price-fixing regime as a result of supplydemand confrontation. A new composition of stakeholders in the iron and steel sectors has emerged, transitioning from an oligopoly to a thwarted monopsony.

Rebound effects following technological advancement? The case of a global shock in ferrochrome supply

“…This would mean that GDP targets are not the only driver of Chinese exports. This is in line with Sourisseau's observation of a very heterogeneous Chinese steel sector (Sourisseau, 2018).…”

“…An additional complexity is the heterogeneity of the Chinese steel market: while some of the larger companies are subject to (some degree of) governmental control, many of the smaller ones are not. So to conclude, China certainly has some market power, driven by GDP targets leading to excess steelmaking capacity, yet it cannot be considered a mono-or oligopolist (Sourisseau, 2018).…”

The UK and German Low-Carbon Industry Transitions from a Sectoral Innovation and System Failures Perspective

“…Nevertheless, the latter are also dependent on midstream firms, as these account for a significant fraction of their sales. The structure of the iron and steel industry has undergone significant restructuring, from the 1988 privatisation [163] to mergers and acquisitions throughout the 2000s [164]. The same applies in chemicals, where global reshaping led to establishment of companies resulting from mergers [165], although the sector includes numerous SMEs [166], due to the broad spectrum of products.…”

Global steel production in the first two decades of the 21st century: a period of economic fluctuations and attempts to control globalisation processes

“…An important inspiration for the research is the emergence of publications on various aspects of the functioning of the steel industry at the level of certain countries or regions (cf., e.g. Brandt Roman Matykowski, Anna Tobolska et al, 2020;Hasanbeigi, 2011;Noviello, 2018;Ozga-Blaschke, 2016;Sourisseau, 2018;Wiedermann, 2002;Wilczyński, 2020).…”