London: NRI steel tycoon Lakshmi Mittal today said that the global steel industry has to accelerate the pace of consolidation in order to cope with the cyclical market downturn and China has a big role to play in this.


Addressing the Confederation of British Industry's Annual Conference here, Mittal, a key figure in the merger of Mittal Steel with its European rival Arcelor to create the world's biggest steel company, also referred to the tug-of-war for control of Anglo-Dutch steelmaker Corus, which is being courted by both Tata Steel of India and Brazilian rival CSN.

"The companies dominating the headlines may change but the theme is constant consolidation...Even as we speak there is a new battle underway with the target none other than the former British Steel, Corus," he said.

Consolidation is the only 'way forward' for the highly fragmented steel industry to survive and sustain profitability, he said.

"The industry, which has been suffering from falling steel prices and a supply glut, has to consolidate much further than it has achieved so far," he said.

"China will play a crucial role in the next wave of consolidation, which should create global players producing 100 million tonnes of steel or more," Mittal, Chief executive officer of Arcelor Mittal told the business leaders.

Mittal exhuded confidence that the global steel sector would keep up with the current momentum of consolidation.

"China of course has a big role to play in this. As the largest producer and consumer of steel, it must also be part of the consolidation process if we are to have any long-term success in creating a more stable operating environment," he said.