Sightings

Sightings

From Russia With Ore

Summer 2010 By Rebecca Scherer | PHOTOGRAPHY BY Stringer Shanghai / Reuters 

You have to be tough as steel to weather this economy—a point that China has taken literally. The country has turned itself into the world’s premier steel producer, supplying almost half of the world’s steel. But even strong metal bends during hard times. By heavily basing its economy on steel and the many industries that rely on it—automobiles, ships, appliances, buildings, weapons—China has been hit hard by the global downturn. Some Chinese steel mills have spent the last two years at a standstill.

But the industry is showing signs of recovery, ensuring continued jobs for workers at mills like the one pictured above in Wuhan, in Hubei Province. As of April, China had increased its steel production by 27 percent over the previous year. Meanwhile, several of China’s largest steel-producing companies inked agreements to mine iron ore (the main component of steel), among other resources, out of Siberia—far closer than Brazil, Australia, the United States, and other nations from which China imports iron. In fact, China has quietly become Russia’s number-one trading partner, exchanging goods and services in excess of $39.5 billion annually—a number that can only grow given the one billion tons of iron ore estimated to be buried beneath the Siberian terrain.

Though the Russian mines’ proximity will help China drastically reduce steel-production costs, observers remain skeptical of closer economic ties between two countries with a history of mutual mistrust. But at least for now, China’s agreement with its northern neighbor is molding its steel industry—and its economy—back into shape.