BEIJING (XFN-ASIA) - China's steel sector needs to restructure more rapidly and phase out inefficient loss-making mills, the National Development and Reform Commission (NDRC) said on its website.

The commission also called for more rational output and improved controls on capacity expansion.

'Steelmaking is a critical part of the country's industrial base, and since reforms began in the sector, accomplishments are evident,' the NDRC said.

The commission added that with the steel industry was forecast to grow as rapidly as GDP, now is not the time to relax the restructuring of the sector.

'Blind investment, rampant overproduction and short-sighted capacity expansion remain the biggest problems in the steel industry,' it said.

The NDRC recommended a clampdown on illegal mills and unauthorized capacity expansion, the closure or absorption via merger of inefficient producers, technology upgrades, consolidation and improved management practices.

China's steel sector continues to expand despite government efforts to reduce output, with most analysts saying the country currently has 100 mln tons of excess capacity.

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