Posted on 22 Mar 2022
Daily crude steel production among the 247 Chinese blast-furnace and 71 electric-arc-furnace steel mills under Mysteel's regular survey continued to grow over the middle ten days of March to hit a six-month high of 2.73 million tonnes/day, higher by another 72,700 t/d or 2.7% from the prior ten days.
The further growth was mainly attributed to the fact that many steel mills in northern China resumed normal production with the end of Winter Paralympic Games and the 'Two Sessions' political meetings last week, while other producers still enjoyed healthy profit margins, encouraging them to ramp up production. These factors, coupled with the expectation for better demand over March-April, the traditional peak season for steel consumption, led output to climb, Mysteel Global noted.
The rise was in line with Mysteel's other survey, which showed that capacity utilization among the surveyed 247 BF mills came in at 81.88% over March 11-17, reversing up 2.1 percentage points on week and touching the highest since October 2021.
However, demand from end-users was not as strong as expected, as work on construction sites in some regions where new COVID cases were found has been suspended in response to local government measures introduced to contain the virus spread, as Mysteel Global reported.
For example, over March 11-20, the daily trading volume of construction steel comprising rebar, wire rod and bar-in-coil among the 237 steel traders across China under Mysteel's regular survey averaged 169,160 t/d, down 5,990 t/d or 3.4% from that for early March.
Chinese domestic steel prices had been dampened by the continuous recovery in output and the lower-than-expected demand, with the national price of HRB400E 20mm dia rebar reaching Yuan 4,955/tonne ($778/t) including the 13% VAT as of March 18, losing Yuan 6/t from that on March 10, according to Mysteel's assessment.
Source:Mysteel Global
