Skip to Content
Stock Strategist Industry Reports

China's Massive Stimulus and U.S. Steel Companies

China's stimulus program is stabilizing the world steel market.

Mentioned: , , , , , , , , ,

China's CNY 4 trillion ($586 billion) stimulus program made its economy the envy of the world. Chinese steel prices bottomed in March and imports of base metals soared in the second quarter. How will Chinese stimulus spending affect the United States steel market? Are U.S. steel companies likely to benefit from Chinese demand? Here we break down China's stimulus spending and highlight how Chinese demand is affecting U.S. producers. The numbers seem to suggest that Chinese stimulus demand is helping to stabilize the world steel market, which in turn benefits U.S. steel producers.

An Analysis of Chinese Stimulus Spending
According to the details provided by the central government, over 60% of the $586 billion stimulus package will go into infrastructure construction, including railways, roads, airports, power grid investments, rural infrastructure, and earthquake zone reconstruction. Another 9% goes into rural infrastructure spending such as paving roads and building bridges. The rest of the stimulus spending will be directed to the provision of welfare and environmental programs.

Min Ye does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.

Transparency is how we protect the integrity of our work and keep empowering investors to achieve their goals and dreams. And we have unwavering standards for how we keep that integrity intact, from our research and data to our policies on content and your personal data.

We’d like to share more about how we work and what drives our day-to-day business.

We sell different types of products and services to both investment professionals and individual investors. These products and services are usually sold through license agreements or subscriptions. Our investment management business generates asset-based fees, which are calculated as a percentage of assets under management. We also sell both admissions and sponsorship packages for our investment conferences and advertising on our websites and newsletters.

How we use your information depends on the product and service that you use and your relationship with us. We may use it to:

  • Verify your identity, personalize the content you receive, or create and administer your account.
  • Provide specific products and services to you, such as portfolio management or data aggregation.
  • Develop and improve features of our offerings.
  • Gear advertisements and other marketing efforts towards your interests.

To learn more about how we handle and protect your data, visit our privacy center.

Maintaining independence and editorial freedom is essential to our mission of empowering investor success. We provide a platform for our authors to report on investments fairly, accurately, and from the investor’s point of view. We also respect individual opinions––they represent the unvarnished thinking of our people and exacting analysis of our research processes. Our authors can publish views that we may or may not agree with, but they show their work, distinguish facts from opinions, and make sure their analysis is clear and in no way misleading or deceptive.

To further protect the integrity of our editorial content, we keep a strict separation between our sales teams and authors to remove any pressure or influence on our analyses and research.

Read our editorial policy to learn more about our process.