Study on MSAD-based Prediction of Steel Production

In 2009, the capacity utilization and profit margin were 76% and 2.43% respectably in steel industry. The profit margin is lower caused by the lower capacity utilization. Balance between production and sale is one key means to develop steel industry healthily and improve the profit margin. Different from other data analysis models, MSAD use historical production data of industry to predict the output in specified period. It prefers to analysis the development of industry and corresponding demand trends, and to predict the “Effective Demand” in the future. Based on the theory of MSAD, “Effective Demand Created by Consumer”, in 2015, there are 739.86 million tons to 740.95 million tons steel demand in domestic market and 50 million tons steel demand in international market. Two scenarios, the overcapacity scenario and the constant capacity scenario, were designed based on steel capacity in 2011. Analyzing the result of research, in the constant capacity scenario, the capacity utilization is 84.43%. In the overcapacity scenario, when the capacity growth with growth rate 1.36% per year, the capacity utilization would be 80%. The studies also analyze the harm of overcapacity, and propose the development strategies to maintain industry healthy without overcapacity. Therefore, the study could provide some reasonable and proper references for the planners about how to develop steel industry healthily.