"The Indonesian plant, owned and operated by the Chinese stainless-steel firm Tsingshan, opened in 2017. The choice of location was no coincidence: Indonesia has the world’s largest reserves of nickel, a key component of stainless steel. More than two-thirds of the world’s nickel is used to make stainless steel. (Regular steel consists almost exclusively of iron, while stainless steel also contains nickel and chromium.) And the plant’s construction was supported by the Chinese government; indeed, it falls within China’s global Belt and Road Initiative.
Then, when the plant had operated for less than two years, the Indonesian government suddenly announced that it would ban exports of nickel starting in January of this year. Predictably, the move caused global nickel prices to skyrocket. But thanks to its Indonesian plant, Tsingshan is shielded from the nickel hike.In the past two decades China has conquered the stainless-steel market. Though stainless steel may seem unsexy, it’s vital to virtually every other sector, and production is growing faster than that of other metals such as lead, copper, and aluminum. Weaponry, pipelines, ships, and washing machines all contain stainless steel.
And in the past couple of decades, the production of steel—the main component of the stainless kind—has shifted dramatically.
In 2004, the world’s top 10 steel producers included only one Chinese company, Shanghai Baosteel; the other top firms were American, European, Indian, and South Korean. Back then, just 25.8 percent of the world’s steel was made in China. In 2018 (the latest year with data available), six of the world’s largest steel companies were Chinese, some of them government-owned, and China accounted for 51.3 percent of global steel production—a figure that doesn’t capture production by Chinese companies in other countries).
On the global top 10 list, South Korea, a former steel giant, is represented only by Posco. In stainless steel, the development is even more stark: in 2005, China produced 12.9 percent of the world’s stainless steel, while Europe produced 34.8 percent and the United States 9.2 percent. By 2018, China had more than quadrupled its share to 52.6 of the world’s stainless steel, while Europe’s share had shrunk to 15.6 percent and the United States had just a 5.5 percent share."
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