Posted on 15 Jun 2021
The growth in daily crude steel output among the 318 Chinese steel mills under Mysteel’s regular survey since mid-April continued over June 1-10, rising by another 21,900 tonnes/day or 0.7% from the prior eleven days to average 3.08 million t/d, according to the latest findings released on June 11. The average also refreshed the all-time high since Mysteel first conducted the survey in January 2018.
The 318 surveyed mills comprise 247 blast-furnace (BF) and 71 electric-arc-furnace mills across China. The persistent growth suggested that domestic steel mills continued to ramp up production in early June despite their profit margins being undermined by the fall in domestic finished steel prices.
As of June 10, China’s national price of HRB400E 20mm dia rebar, a barometer of the country’s spot steel market sentiment, was assessed at Yuan 5,184/tonne ($811/t) including the 13% VAT, lower by Yuan 73/t from that on May 31, according to Mysteel’s data.
The gross profits that the BF mills earned on rebar sales had fallen to Yuan 224/t as of June 10 against the Yuan 410/t at the end of May, Mysteel estimated, based on current steel and raw materials prices.
Although demand from end-users has shown signs of slowing with the coming rainy season in South and East China, it still stayed at a healthy level, Mysteel Global noted. Finished steel stocks at traders’ warehouses were still declining, which gave domestic steel mills some confidence to keep the production high.
For example, Mysteel’s other survey among 237 trading houses across China showed that the daily trading volume of construction steel comprising rebar, wire rod and bar-in-coil averaged 201,759 t/d over June 1-10, up 6,512 t/d or 3.3% from late May.
Total stocks of the five major steel products comprising rebar, wire rod, hot-rolled coil, cold-rolled coil and medium plate at commercial warehouses in 132 cities nationwide emptied for the fifth week by another 0.5% on week to reach 21.33 million tonnes as of June 10, according to Mysteel’s latest weekly survey.
Source:Mysteel Global
