Only 10 percent of steel transactions go through e-commerce platforms, but analysts expect the figure to grow as high as 30 percent in the years to come.

Not a panacea

While e-commerce trading platforms are catching on and offers a direction for steel companies, analysts have said that they are not a cure-all and advised caution against an unbridled e-commerce rush.

"An e-commerce platform may be an effective way to sell standard and uniformed steel products but they cannot meet the needs of users who require custom-made products," said Cheng Ming, professor of new steel technology research institute of Wuhan University of Science and Technology.

"The biggest challenge facing the steel sector is still overcapacity. Even though some steel makers may win some time with the help of e-commerce platforms, the possibility of being written off the map amid industry restructuring is still there," he added.

"It's unnecessary for everyone to launch their own e-commerce platform," warned Liu Leiyun, president of China National Association of Metal Material Trade. "Otherwise, it will become another overcapacity problem."

Analysts have called for innovation and upgrading, saying these are key to the survival of steel companies in the long run.

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