Posted on 11 Nov 2024
Production among Chinese blast furnace (BF) steelmakers retreated for the second straight week as more mills started maintenance works in response to the weakening steel prices and demand, Mysteel's latest survey showed.
The average capacity utilization rate among the 247 BF steelmakers under Mysteel's regular survey dropped by 0.53 percentage point on week to 87.87% over November 1-7, with their hot metal output averaging 2.34 million tonnes/day, lower by 0.6% on week.
During the same period, the average operational rate among these sampled mills also decreased by 0.15 percentage point from the previous week to 82.29%, the survey showed.
The further decline of steel prices pushed more steelmakers in China to the brink of losing money on steel sales, dampening their enthusiasm to lift production, Mysteel Global noted.
For example, China's national spot price of HRB400E 20mm diameter rebar was assessed by Mysteel at Yuan 3,588/tonne ($501.9/t) including the 13% VAT on Thursday, lower by Yuan 43/t or 1.2% on week.
By the same day, only around 60% of the sampled 247 mills could make some profits on steel sales, lower by 1 percentage point from a week earlier, according to Mysteel's tracking.
Meanwhile, China's steel demand from end-users gradually weakened as the winter cold was impeding outdoor construction activities, especially in the country's northern regions, which forced steelmakers to produce more cautiously, as reported.
Consequently, the daily consumption of imported iron ore among the 247 BF mills under Mysteel's survey nudged down by 0.2% on week to average 2.9 million t/d during November 1-7.
Nevertheless, domestic steel mills' procurement of imported iron ore stayed at a relatively high level this week. The total inventories of imported iron ore in all forms held by these 247 mills increased by 1.3 million tonnes or 1.5% on week to reach 91.3 million tonnes by November 7, Mysteel's tracking data showed.
This would be sufficient to last these surveyed mills for 31.5 days at their current usage rate, longer by 0.5 day from the previous period, Mysteel assessed.
Source:Mysteel Global
