FEATURE-1: China raw material supplies up, and steel?

In reality, though, Chinese steel producers seem to have been troubled with more than just the constraint in raw materials deliveries, as the steel capacity utilization rate among 231 enterprises in steel industry up merely 1.4 percent from February 15 to 72.1% on February 26, or even lower than the 74.3% on February 11 when Mysteel started monitoring these mills on the daily basis to track the progress among the Chinese steel mill in resuming operations amid the battle against the novel coronavirus disease (COVID-19).

As of February 20, the capacity utilization among the 53 EAF mills in China was only 3.4%, down 0.7 percentage point on week or 0.8 percentage point lower from February 6, Mysteel's data showed.

Bottlenecks in steelmaking raw materials deliveries smoothing out

Yantai port in East China's Shandong province, for example, completed unloading a total of 317,000 tonnes of imported iron ore from the ship of Brazilian iron ore miner, Vale, in 26 hours on February 20, or a record high speed, the port shared in a post on February 21.

As for coal, an essential industrial material for China's economy, about 76.5% of China's coal mines had already been in operation as of February 22, or equivalent to 3.2 billion tonnes/year coal capacity for all use, Lu Junling, director of Department of Coal in National Energy Administration (NEA) shared at a press conference on February 23.

The operational rate was much 6.3 percentage points higher than that on February 17, and nearly twice as large as in early February, Lu noted, commenting, "(as of then) the impact of the epidemic on coal production has been generally offset, and the operational rate has returned to the same level as a year ago."

Growing coal supply has made it possible for China's coking plants to ramp up their production, an industrial source in North China's Shanxi observed.

Steelmaking raw materials supplies are expected to increase further in the coming days, as more Chinese companies and industrial sectors have been gradually returning to the working order though not yet at the full capacity starting mid and late February, as the Beijing is trying to limit the affection of the COVID-19 on the national economy when some progress has been made in battling against the virus, though it is still early days to judge whether the virus has been under control.

Many employees, thus, have returned to the company sites from working from home since in the first two weeks of February, though workforce will remain stretched for a short period, as employees staying in the company dormitories will still need to go through a 7-14 day quarantine before they can return to work.

 Iron ore stockyard at Dalian port, Northeast China

Click here for part 2 of the feature

Written by Sean Xie, xiepy@mysteel.com and Victoria Zou, zyongjia@mysteel.com

Edited by Hongmei Li, li.hongmei@mysteel.com