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Unhappily for steelmakers, heavy plate consumption among Japan’s shipbuilders seems certain to decline further as the yards adjust building programmes to cope with the continuing slump in new vessel orders, Mysteel Global notes. Total orders received by the Japanese builders in June tumbled by 52% on year to the equivalent of 342,200 gross tonnes in eight vessels and made for the fifth consecutive month of on-year declines, according to new data released by the Japan Ship Exporters’ Association (JSEA) on July 10.
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Mongolia’s target to lift its annual coal exports to exceed 40 million tonnes this year may have suffered a delay, chiefly owing to the pandemic’s advance from early this year and which continues to adversely impact shipping volumes. According to the country’s latest Customs data published on July 8, over the January-June period the volume slumped by 52% on year to 8.7 million tonnes, among which 96.4% was exported to China.
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Japan’s crude steel demand for the July-September quarter is expected to plunge by 27.9% year on year and down 3.2% on quarter to 17.7 million tonnes, according to the forecast released by Japan’s Ministry of Economy, Trade and Industry (METI) on July 8, indicating the domestic steel mills will have to maintain low production.
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China’s fixed asset investment on railways and rail infrastructure reached Yuan 325.8 billion ($46.4 billion) over January-June, up Yuan 38 billion or 1.2% on year. Within the total, the investment in railway infrastructure alone reached Yuan 245.1 billion, recording an on-year increase of 3.7%, according to a post on the website of the China State Railway Group (China Railway) on July 5.
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China’s 91 blast-furnace mills under Mysteel’s monthly survey have reported that the gross profits they earned on the three major steel products all shrank last month, with their average margin on rebar plunging the deepest, tumbling by Yuan 163/tonne ($23.3/t) on month to just Yuan 92/t for June. Survey respondents chiefly blamed higher production costs for procuring raw materials against lower rebar prices amid sliding wet-season steel demand.
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Russia, the world’s third-largest coal exporter, posted a notable 6.3% on-year decline in total coal exports over this year’s January-June period to 88 million tonnes, according to recent data from the Russian Federation’s Ministry of Energy (MoE). Analysts ascribed the lower coal exports to the spread of COVID-19 in H1 that affected global coal demand.
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Japan’s electric-arc-furnace (EAF) steel producers may be struggling to ink more billet export deals to fend off a weakening domestic steel market, as overseas buyers have showed waning enthusiasm in booking recently, mini-mill sources in Tokyo and Osaka shared on July 7.
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The Purchasing Managers’ Index (PMI) for the steel industry in North China’s Hebei province, the country’s largest steel production base, reversed down to 51.5 in June after the prior three months’ continuous increase, according to the latest release by the Hebei Metallurgical Industry Association.
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Sales of heavy-duty trucks across China enjoyed a healthy 59% on-year surge in June to reach 165,000 units, according to a preliminary estimate published by Beijing-headquartered Commercial Vehicle World (CVWorld). Last month’s sales were still lower by 8% from May, however.
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Stocks of hot-rolled, cold-rolled and coated coils and sheets at Japanese mills, coil centers and distributors at the end of May were higher by 2.4% on month or by 105,000 tonnes to reach some 4.46 million tonnes, according to the latest data from Nippon Steel published on July 2. Industry watchers blamed restricted deliveries to customers for the rise, even though producers were cutting output to reduce inventories.
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China’s large- and medium-sized iron ore mining companies earned a total of Yuan 6.8 billion ($1 billion) from sales of iron ore concentrates over January-May, higher by 20.2% on year, according to the latest survey from the Metallurgical Mines’ Association of China. Improved prices for their concentrates are what did the trick, MMAC data show.
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Japan’s Purchasing Managers’ Index (PMI) for its manufacturing industry recovered by 1.7 basis point on month to 40.1 for June, indicating that the operations and market sentiment had been improving after a few months of declines since February, according to the release from au Jibun Bank Corporation on July 1.
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By the end of May, Japan’s carbon steel stocks at steel mills and distributors totaled 5.93 million tonnes, up 2.4% on month, or the first rise in three months, according to the data released on June 30 by the Japan Iron & Steel Federation (JISF), indicating faster domestic demand decline and the no effect shown from production cuts, according to the market sources.
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Japan’s ordinary carbon steel exports fell by 21.4% year on year in May to some 1.63 million tonnes, according to data released by the Japan Iron & Steel Federation (JISF) on June 29. The impact of COVID-19 on customer demand abroad was the main reason for the decline, the Association explained.
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China’s Purchasing Managers’ Index (PMI) for its manufacturing industry reversed up 0.3 basis point on month to 50.9 in June with major elements such as new orders and production posting gains on month, according to the release from the country’s National Bureau of Statistics (NBS) on June 30.
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After three months of recoveries, China’s Purchasing Managers’ Index (PMI) for the steel industry reversed down in June by 1.6 basis points on month to 49.3, as steel production rapidly grew while demand softened, and the PMI for H1 averaged 45.3, down 5.5 basis points on year mainly because of the COVOD-19 outbreak, according to the release by CFLP Steel Logistics Professional Committee (CSLPC) on June 30.
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Japan’s eight major automakers posted their May production fell 62.8% on year or 1% on month to 912,377 units in total from all of their global plants, Mysteel Global calculated basing on their individual releases on June 29, which was mainly due to the negative impact of the COVID-19 on their operations and market demand, according to market sources.
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China's steel PMI for June eased to 49.3, or down 1.6 basis points from May, according to the release by CFLP Steel Logistics Professional Committee on June 30. A detailed report will be posted soon.
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Concerns are mounting among Japanese stainless producers and dealers about the large volumes of stainless cold-rolled coil imports arriving, and fears that the domestic market will be disrupted. “I can’t see any signs that imports are tapering off and yet, domestic demand is shrinking,” a sales official from a major stainless distributor in Tokyo lamented. “The supply-demand balance is certain to soften further, which make our business situation even more severe,” he said.
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China’s coking coal imports still declined by 23.8% on month or 19.1% on year to 4.8 million tonnes for May, even though the plunge in Australian coking coal imports was partially offset by a marked growth from Mongolian supplies, according to the latest breakdowns by country from China’s General Administration of Customs (GACC).
