China’s daily average crude steel production drops to 2.317mn mt in late-July (July 21-July 31), down by 3.97pc from mid-July, while down by 3.03pc from a year ago, according to China Iron & Steel Association (CISA) data. The data reflects that Chinese mills have stuck to the task of lowering crude steel production as directed by Chinese authorities.
Production level is also lower compared to the prior year, although Chinese mills had overcome the impact of the COVID-19 pandemic in H2 last year. China has resolved to keeps crude steel production in H2 2021 lower than from H2 2020.
After pulling back the incentives offered for steel exports, China is hopeful of stabilizing steel and steelmaking raw material prices in the domestic market. While the production cuts have prompted Chinese buyers to raise enquirers for billet imports.
| China’s average daily output in late-July (mn mt) | ||||
|---|---|---|---|---|
| Production | Late-July | Mid-July | Change | Change (YoY) |
| Crude Steel | 2.317 | 2.193 | -5.34% | -3.03% |
| Pig iron | 2.071 | 1.908 | -1.37% | -2.43% |
| Steel | 2.327 | 2.126 | -0.51% | -2.93% |
Daily steel products’ output rose to 2.327mn mt in late-July, down by 2.93pc from the prior year and down by 0.51pc from mid-July. Pig iron production was at 2.071mn mt, down by 2.43pc from the prior year, while down by 1.37pc from the prior 10-day period.
Key steelmakers’ cumulative crude steel production in July rose to 66.45mn mt at average daily crude steel output of 2.143mn mt, down by 13.36pc from the prior-year period and down by 4.42pc from June. Steel products output rose to 64.13mn mt at a rate of 2.068mn mt, down by 11.17pc from June and 2.98pc from the prior year.
Steel inventories at key producers in late-July fell to 13.81mn mt, down by 7.40pc or 1.104mn mt from mid-July. Inventories are higher by 5.2pc or 683,600mt from the prior year.