China's steel industry is the biggest in the world, producing 45.7 percent of global output from January to April and importing a record 210 million tonnes of iron ore over the same period.
But the government is keen to strengthen the position of the biggest producers and shut smaller, outdated capacity.
Analysts estimate there are more than 3,000 steel mills in China with the top five producers accounting for 29 percent of output last year, far short of a government target of 50 percent by the end of 2010.
The following is a list of China's ten biggest steel producers and the efforts they are making to boost capacity.
1. HEBEI IRON AND STEEL, 40.2 million tonnes, up 20.7 percent. China's biggest steel producer for the first time in 2009, with output second only to ArcelorMittal among its global peers, is in talks to buy Shijiazhuang Steel, also based in Hebei province, as well as other potential targets.
2. BAOSTEEL GROUP, 38.9 million tonnes, up 9.9 percent. China's traditional market leader, based in Shanghai, has also been active in buying smaller mills like Bayi Iron and Steel and Guangdong Iron and Steel.
3. WUHAN IRON AND STEEL, 30.3 million tonnes, up 9.4 percent. Also known as Wugang, based in central Hebei, bought Brazil's MMX late in 2009 to build iron ore supplies and become self-sufficient in the crucial steel-making raw material within four years.
4. ANBEN IRON AND STEEL, 29.3 million tonnes, up 25.2 percent. A company formed after state-owned giants Anshan Iron and Steel <0347.HK> merged and based in northeastern Liaoning province.
5. JIANGSU SHAGANG GROUP, 26.4 million tonnes, up 13.3 percent. China's biggest private steel firm, based in the Yangtze River delta near Shanghai, recently signed a strategic cooperation deal with Baosteel after merger talks faltered.
6. SHANDONG IRON AND STEEL 21.3 million tonnes, down 2.4 percent. Located in Shandong province on the eastern coast, the company aims to buy 10 million tonnes of additional annual capacity through a joint venture with another local mill, Rizhao Steel, and plans to raise total capacity to 40 million tonnes per year by 2020.
7. SHOUGANG GROUP, 17.3 million tonnes, up 41.8 percent. Based in Beijing and established 90 years ago, has almost completed plans to move its production facilities out of the capital into neighbouring Hebei province. The company plans to raise total annual capacity to more than 30 million tonnes by 2012.
8. HEBEI XINWUAN IRON AND STEEL, 16.7 million tonnes, up 27.9 percent. China's second biggest privately-owned mill after Shagang, and was merged from a number of small operators in 2006. Hebei province in northern China has the largest number of small and privately owned steel enterprises in the country, and the authorities are encouraging more consolidation.
9. MAANSHAN IRON AND STEEL, 14.8 million tonnes, down 1.3 percent. The biggest steelmaker in Anhui province with plans to raise capacity to 20 million tonnes per annum by 2011, mainly through expansion.
10. HUNAN VALIN STEEL, 11.8 million tonnes, up 4.9 percent. The only Chinese state-owned steel mill with foreign ownership after ArcelorMittal bought a 33 percent stake. It aims to raise capacity to 30 million tonnes within the next five years by acquiring other smaller mills.