WEEKLY: China's BF capacity use retreats to 90.23%

The operational rate among these sampled steelmakers also dropped 2.37 percentage points on week to 80.12%, while their daily hot metal output averaged 2.41 million tonnes/day, lower by 13,300 t/d on week, the survey showed.

During the latest survey period, a total of 20 blast furnaces were shut down for maintenance, while only four furnaces were brought back online. "Prolonged losses on steel sales have cooled steelmakers' enthusiasm for production," a market analyst based in Shanghai said.

Over October 27-November 2, only around 17% of the 247 sampled steelmakers managed to make some healthy profits, with the profitability still hovering around a one-year low, according to Mysteel's tracking.

"Many steelmakers have started their maintenance work late this week, which may lead the hot metal production to drop more markedly next week," the Shanghai analyst commented.

The daily consumption of imported iron ore by the 247 mills under Mysteel survey averaged 2.94 million t/d over October 27-November 2, falling 12,600 t/d or 0.4% from the previous week due to the reduction in their steel production.

On the other hand, the strong rise in the imported iron ore prices in recent two weeks further pushed up steelmakers' production costs, making the mills more hesitant to procure ore, Mysteel Global noted.

Consequently, as of November 2, total imported iron ore inventories held by these 247 steelmakers stood at 89.9 million tonnes, losing 0.6% on week, Mysteel's survey showed. The stocks would be sufficient to last them 30.5 days at current use rate, 0.05 day shorter than in the previous period, Mysteel assessed.

Written by Anthea Shi, shihui@mysteel.com

Edited by Alyssa Ren, rentingting@mysteel.com