Global largest steel enterprise sets 5 new targets, more than just entering the world-class enterprise list

The world’s largest steel company has a new goal.

China Baowu Steel Group Corporation Limited (hereinafter referred to as “China Baowu” or “Baowu”) outlined five major landmark objectives during its 2026 annual work conference at the beginning of the year: to be among the first batch of world-class enterprises; to lead the industry in ESG achievements and influence; to become an outstanding enterprise in central enterprise technological innovation; to have over 35% revenue from strategic emerging industries; and to maintain industry-leading comprehensive competitiveness and operational performance.

These five goals highlight that technological innovation, green transformation, and global operations will be the key focus areas for Baowu’s development over the next five years.

Despite the current steel industry transitioning from a growth to a contraction market, Baowu is sending a clear signal through a series of solid deployments and breakthroughs: Chinese steel companies must build competitiveness through transformation and seize new opportunities amid challenges.

Innovation First

By the end of November 2025, the Ministry of Industry and Information Technology and five other departments officially announced the first batch of 15 pilot smart factories, with Baosteel, a subsidiary of Baowu,’s “High-end Green Silicon Steel Predictive Manufacturing Smart Factory” successfully selected.

The reason it’s called a “predictive” smart factory is because Baosteel uses AI technology. In 2024, when large models were still emerging, Baosteel formulated an “AI+” intelligent transformation strategy, initiating the smart upgrade of the entire silicon steel process, becoming the first steel enterprise to pioneer AI applications.

However, applying AI effectively in industrial scenarios is challenging. A Baosteel executive explained that during external collaborations, there are inherent differences in data understanding between manufacturing and IT companies. Initially, Baosteel hoped partners would deeply understand the complex steel production process, but practical experience showed this was unrealistic. Baosteel realized it must independently master core data integration and transformation capabilities to realize AI’s potential in complex industrial environments.

The process of exploring the unknown is tough but worthwhile. After nearly two years of development, Baosteel’s predictive pilot smart factory has significantly improved production efficiency: in R&D, the experimental volume of high-grade non-oriented silicon steel was halved with a prediction accuracy exceeding 95%; on-site, AI applications such as blast furnace temperature prediction models and machine vision quality inspection have been fully implemented, with integrated scheduling models across processes increasing daily scheduling efficiency by 70%. Today, the high-end green silicon steel produced by the smart factory is widely used in critical fields like ultra-high voltage transformers and humanoid robot motors.

Baosteel’s high-end green silicon steel predictive manufacturing smart factory. Photo by Baosteel

Products and technology are the foundation of a company’s survival. In recent years, numerous examples within Baowu demonstrate how technological innovation empowers industrial innovation: Ma Steel’s team broke long-standing foreign monopolies, solving ultra-high-precision processing of high-speed rail wheels at 0.03mm, enabling domestically produced high-speed trains to wear “Chinese shoes”; Tai Steel’s innovative team conducted over 700 experiments to successfully produce 0.02mm thick wide “torn steel,” which is widely used in aerospace, new energy, and other high-end fields…

Looking ahead to the “14th Five-Year Plan,” Baowu has made “strengthening innovation” its primary strategic path to becoming a world-class enterprise. As the market shifts from scale expansion to structural upgrading, the competition’s focus shifts from “who is bigger” to “who is stronger and better.” Baowu’s breakthroughs in high-end materials and digital intelligence are forging a key that not only opens the door to high-end markets but also builds a solid technological barrier to help the company navigate cycles and resist risks.

Green and Low-Carbon Breakthroughs

Also by the end of 2025, good news came from Zhanjiang, Guangdong—Baosteel’s investment completed China’s first million-ton near-zero-carbon steel production line.

Zhanjiang Steel’s million-ton near-zero-carbon steel production line. Photo by Baosteel

This production line marks the transition of green metallurgical technology from laboratory research to commercial application. Before Baosteel’s near-zero-carbon line, there were no domestic million-ton hydrogen-based vertical furnaces, and hydrogen metallurgical devices rarely reached industrial scale. The main challenge remains the high difficulty of commercializing green metallurgical processes.

Baosteel’s near-zero-carbon line adopts “hydrogen metallurgy,” a process that replaces coke with hydrogen during iron reduction smelting. To implement this process, companies face challenges such as hydrogen production and transportation, process reengineering, and infrastructure upgrades, resulting in high costs for commercial application. Although this technology was proposed internationally as early as the 20th century, few companies have put “hydrogen metallurgy” into practice.

Wang Xu, a low-carbon emissions product engineer at Baosteel Zhanjiang Steel, explained that based on decades of theoretical research and guided by the “dual carbon” strategy, it took nearly three years of effort to bring the line into operation. With an annual capacity of 1.8 million tons, it is expected to reduce carbon emissions by 50%–80% compared to traditional “blast furnace + converter” processes, potentially cutting over 3.14 million tons of CO2 annually.

Even during the early construction phase, market feedback was positive. Wang Xu noted that during the line’s development, several automotive, 3C, home appliance, and construction companies inquired about orders, which was very encouraging. “This shows that high-grade low-carbon products can meet the sustainable development goals of users, break through carbon barriers, and open up a new market for us.”

Baowu’s practice demonstrates that green development is closely linked to high-end and efficient manufacturing. It drives technological upgrades, lean management, and industrial collaboration, marking a key step for China’s steel industry to shift from “scale manufacturing” to “green value-added.”

Internationalization in a New Stage

“Being among the first batch of world-class enterprises” is one of Baowu’s five major goals for the “14th Five-Year Plan.” Achieving “world-class” status requires international operations.

Baowu has already begun its global layout. On January 17, with the sound of a long horn, the first ship carrying Simandou iron ore arrived at Zhejiang Maji Mountain Port, marking the completion of the full supply chain for this globally largest direct iron ore project in which Baowu participated.

The first ship of Simandou ore arriving at port. Photo by Baowu

The Simandou iron ore is located in Guinea, West Africa, with proven reserves of 4.4 billion tons. It is expected to start production by the end of 2025, with an annual output of 120 million tons. The operation of such a large-scale iron ore project is highly significant for Baowu and China’s steel industry. It will diversify China’s iron ore import sources and significantly enhance resource security.

Baowu’s global expansion is not limited to this. Wang Jian, General Manager of Baowu’s Overseas Business Development Department, explained that Baowu’s “going abroad” can be divided into three stages:

Initially, in the 1980s, to sell products overseas, Baosteel began building an international marketing system and global sales network. After nearly 40 years of development, Baosteel now has an international marketing network comprising four regional headquarters and 28 marketing platforms, supporting Baowu’s global marketing in both domestic and international markets.

As steel manufacturing equipment became more autonomous, subsidiaries like China Steel International began exporting steel engineering capabilities. In 2023, China Steel International completed the Tosyali Turkey 1800mm hot-rolling project, the most advanced and competitive hot-rolled production line exported by Chinese companies, marking China’s technological and equipment innovation in steel manufacturing.

Currently, Baowu is focusing on three main areas for overseas industrial deployment: first, overseas raw material development, including projects like Simandou, Xipo, and Ashburton; second, establishing overseas steel manufacturing bases; third, expanding downstream industries, such as Baosteel Packaging’s five bases and seven production lines across three countries.

Taking business abroad is not just about expanding markets but also about participating in global resource allocation, technological integration, and industrial collaboration to strengthen international operational capabilities. “Building a world-class enterprise requires us to view, plan, and manage our operations from an international perspective,” Wang Jian said.

At the start of the “14th Five-Year Plan,” China Baowu has clarified its vision: “to become a world-class enterprise in the steel and light metal materials industry.” Hu Wangming, Party Secretary and Chairman of China Baowu, stated that Baowu aims to build a more innovative, smarter, greener, more efficient, and more internationalized company, striving to be a respected world-class enterprise that satisfies customers, employees, and shareholders, and contributes more to China’s modernization.