China’s 2019 crude steel output rises 8% on year to almost 1 billion mt

Posted on 20 January 2020
 

Source: Platts

China crude steel production rose 8.3% year on year to 996.34 million mt in 2019, accelerating from 6.6% year-on-year growth in 2018, National Bureau of Statistics data released Friday showed.

The total was just shy of the 1 billion mt mark that iron ore producers BHP and Rio Tinto had earlier predicted would be reached mid- to late this decade.

China’s pig iron output rose 5.3% on year to 809.37 million mt in 2019, increasing from 3% year-on-year growth in 2018, the data showed.

For December, crude steel output was up 11.6% on year at 84.27 million mt and pig iron output up 6% at 67.06 million mt. The totals were up 1.6% and 0.2%, respectively, from November.

Market sources attributed the rise in China’s crude steel and pig iron output in 2019 to relaxed environmental protection constraints on steel mill production, capacity expansion and strong domestic demand, especially from the construction sector.

China’s crude steel capacity rose 42 million mt/year on year to 1.21 billion mt/year in 2019, while pig iron capacity rose 24 million mt/year to 1.01 billion mt/year, according to S&P Global Platts analysis.

The country’s ratio of crude steel to pig iron output rose to 123% in 2019 from 120% in 2018. This was partly due to the commissioning of 15.4 million mt/year of new electric arc furnace capacity in 2019, and also to Chinese steel mills boosting scrap utilization in their converters, especially in the first half of 2019 when steel margins were strong but hot metal supply was tight due to a shortage of imported iron ore.

China’s crude steel output is forecast to rise 2% on year to 1,016 million mt in 2020 and pig iron output to rise 1.7% to 823 million mt, according to Platts analysis. 



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