MYSTEEL: China's mid-June daily steel output gains 1.3%

Daily crude steel output in China recovered slightly during the middle ten days of this month after the decrease in early June, with the average volume rising by 38,100 tonnes/day or 1.3% from the prior ten days to reach 2.98 million t/d, according to Mysteel's estimate based on survey responses from the 247 blast-furnace (BF) and 87 electric-arc-furnace (EAF) steel mills it monitors nationwide.

Some Chinese BF and EAF mills resumed operations in mid-June, thanks to the healthier profits they could earn on finished steel sales with the further recovery in domestic steel prices, Mysteel Global learned.

Mysteel's weekly survey showed that capacity utilization among the 247 BF mills under its tracking increased by another 0.65 percentage point on week to 90.32% over June 9-15, while that among the 87 sampled EAF mills under its survey came in at 47.91% during the same period, up 2.12 percentage points from the prior week.

Chinese steel prices strengthened overall in mid-June thanks to the positive sentiment in the domestic market, with the national price of HRB400E 20mm dia rebar, a bellwether of domestic steel-market sentiment under Mysteel's assessment, reaching Yuan 3,876/tonne ($539/t) including the 13% VAT as of June 20, higher by Yuan 49/t from that on June 9.

However, steel transactions in the physical market remained lackluster as demand from end-users was weak with the approach of summer and the accompanying high temperatures and frequent rains in many regions of China, Mysteel Global noted.

For example, daily trading volume of construction steel comprising rebar, wire rod and bar-in-coil among the 237 Chinese trading houses under Mysteel's regular survey averaged 159,633 t/d over June 11-20, down 269 t/d from that for early June.

Written by Nancy Zheng, zhengmm@mysteel.com

Edited by Zhenqi Yang, yangzhenqi@mysteel.com