Paragraph entered by Atlantic migration, in order for SteelFirst articles to display correctly on Metal Bulletin.
Member mills of the China Iron & Steel Assn (Cisa) produced crude steel at an average rate of 1.806 million tpd during the last ten days of June, down 1.4% from the preceding ten-day period, according to the industry body’s estimates reported on Thursday July 9.
Cisa member mills, which are mainly medium-sized and large steelmakers, account for roughly 80% of the country’s total steel output.
The retreat in production was expected, as the country’s steel prices have been under downward pressure since the end of May. Conversely, output trended upwards since the beginning of last month, which further weighed on the market, participants said.
“It seems that mills finally responded to the rapid price falls over the month [by lowering output]. But the decline is too small to trigger any upward momentum for prices, unless major mills take steps to cut their production,” a Shanghai-based trader told Steel First.
Eastern Chinese hot rolled coil prices were at 2,220-2,250 yuan ($362-367) per tonne on June 30, down 150-160 yuan ($24-26) per tonne from levels on May 29. The region’s rebar prices fell by a large 190-200 yuan ($31-33) per tonne during the same period, according to Steel First’s price archive.
As at June 30, Cisa member mills had a total of 16.37 million tonnes of finished steel in their inventories, down 6.2% from June 20 levels, according to the industry body’s data.
China’s daily crude steel output finally started declining in late June, following continual drops in steel prices throughout the month.