Posted on 25 Jul 2022
Over July 15-21, the blast furnace (BF) capacity utilization rate among China's 247 steel mills under Mysteel's survey had dropped for the fifth week by another 2.61 percentage points on week to 81.4% as of July 21, or a new low since mid-March, as most mills had been cautious about their steel output amid thin profit margins or even losses with the persistently declining steel prices.
Over the latest survey period, daily molten iron output among these 247 surveyed mills, thus, dipped by 70,200 tonnes/day on week to 2.19 million t/d in total, and their BF operational rate also declined by 3.91 percentage points on week to 70.34%, or 9.62 percentage points lower on year, indicating that more had been on maintenance.
"During the survey period, some steelmakers in North and East China started conducting maintenance on their BFs, given the losses they were suffering and negative market sentiment," a Shanghai-based market watcher commented.
As of July 21, China's national price of HRB400E 20mm dia rebar under Mysteel's assessment fell Yuan 38/tonne ($5.6/t) on week to Yuan 4,034/t and including the 13% VAT. And over July 15-21, spot trading of construction steel among China's 237 trading houses under Mysteel's survey stayed tepid, hovering low at 152,584 t/d on average.
In tandem, a total of 31 blast furnaces were idled during the survey period. And Mysteel's other survey on these steel mills showed that only 9.96% had managed to earn some profits as of Thursday, or a new low since January 2016.
Lower steel output saw these steel mills reduce their imported iron ore inventories, as the total volume including all forms and the tonnage at their steelworks, port stockyards and on the water, decreased by another 992,400 tonnes on week to 100.1 million tonnes.
The tonnage could still last 37.61 days of use, or 0.81 day longer than the previous survey period, as their daily iron ore consumption fell by 85,500 t/d on week to average 2.66 million t/d over July 15-21.
Source:Mysteel Global
