China daily crude steel output declines in late May

Daily crude steel output among the member mills of the China Iron and Steel Association (CISA) declined during the last eleven days of May, with the tonnage lower by 4.6% or 80,000 tonnes/day from the middle ten days to average 2.01 million t/d, according to the latest release from the association on June 4.

In addition, the average was also lower by 4.1% compared with the level over the same period last year, the CISA survey results indicated.

Based on the performance of its member mills, the association estimated that daily crude steel output among both member mills and non-member mills averaged 2.69 million t/d in late May, showing a 4.3% drop compared with the mid-May period.

The association noted in the release that maintenance stoppages of large steelmaking facilities undertaken by some member mills during the period were primarily responsible for the "relatively large changes" in crude steel output.

Member mills in North China, the hub of the country's steel sector, contributed the most to the overall drop in crude steel output among the six regions CISA regularly checks.

Steelmakers in the region produced an average of 636,000 t/d of crude steel over May 21-31, dropping by a large 8.3% or 57,000 t/d from the level in the middle ten days of last month, the release data revealed.

On the other hand, daily finished steel output among CISA member mills averaged 2.07 million t/d over the last eleven days of May, rising by 3.2% or 64,000 t/d from May 11-20, the same release showed.

This mild increase was mainly due to several member mills carrying out bulk month-end finished steel warehousing, CISA explained. Excluding this factor, the association's data show that daily finished steel production was still 2.6% above the level recorded in mid-May.

Despite higher finished steel output, the tonnage of finished steel stocks held by both CISA member mills and traders trended downwards over the reporting period. Specifically, finished steel inventories held by CISA members declined by a marked 15.7% or 2.94 million tonnes from the May 20 level to sit at 15.83 million tonnes as of May 31, according to another CISA report released on the same day.

Meanwhile, the tonnage stored in commercial warehouses in the 21 Chinese cities the association checks edged down by 1.6% or 150,000 tonnes over the same period to 10.22 million tonnes, according to another release from CISA.

Source:Mysteel Global