Posted on 13 Oct 2022
The Purchasing Managers' Index (PMI) for the steel industry in North China's Hebei province, the country's top steel production base, retreated to 50.7 in September after the prior month’s increase, losing 3.5 basis points on month, according to the latest release by the Hebei Metallurgical Industry Association on its website.
Despite the decline, Hebei's steel PMI for September was still above the 50-threshold connoting expansion, the association pointed out.
However, the September result was 0.6 basis points lower compared with that for the national steel PMI reading of 51.3, even though the latter had decreased by a far larger 5.5 basis points on month, Mysteel Global noted.
For September, the sub-index for new orders among Hebei's steel mills slipped to 53.6, down by 4.5 basis points from the previous month, mainly due to lower-than-expected demand and sluggish transaction sentiment. Buyers chose to purchase only for their immediate needs as they were trying to control risks.
The sub-index for new export orders reversed down too after the short-lived rise over the prior month, tumbling by 6.8 basis points to 43.2, according to the release.
Last month, the sub-index for Hebei's steel production came in at 54.7, down 2.3 basis points from that for August, as the losses that the integrated mills and mini-mills were suffering expanded. Although the capacity utilization rate among blast furnaces and electric furnaces has rebounded, the growth rate of production slowed down compared with that for August.
Finished steel stocks held by steelmakers in Hebei also saw a decrease last month amid the production constraints that steel mills were observing and the slight recovery in downstream demand. The sub-index for finished steel stocks declined by 9.6 basis points on month to 47.5 in September, the association noted.
The sub-index for raw material stocks held by these steelmakers also dropped by 18.4 basis points on month to 38.4 in September, as local mills preferred to purchase only for their immediate needs, considering the moderate supply growth and rising costs for hot metal, it said.
Source:Mysteel Global
