China’s crude steel output rebounds in early April on market recovery
China’s daily crude steel output rebounded in early April amid a recovery in domestic steel prices.
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The country produced 2.1515 million tpd of crude steel during the first ten days of the month, up 3.78% from the last eleven days of March, according to estimates released by the China Iron & Steel Assn (Cisa) on Thursday April 17.
Output of Cisa member mills, which are mainly medium-sized and large steelmakers, averaged 1.7473 million tpd in early April, up 4.69% from the preceding period.
Higher steel prices and improved profits could have encouraged mills to accelerate production, market sources suggested.
Eastern Chinese rebar prices were at 3,300-3,350 yuan ($534-542) per tonne including VAT on April 10, up 130 yuan ($21) per tonne from the level on March 31. The region’s hot rolled coil also gained 60-70 yuan ($10-11) per tonne over the same period, according to Steel First’s price archive.
Market participants are concerned that mills could continue maintaining high output in the short term due to relatively firm sentiment during the traditional peak season, which would likely weigh on prices later this month.
As at April 10, Cisa member mills’ combined finished steel inventory totalled 15.139 million tonnes, down 1.8% from the level on March 31, according to the association’s data.
The destocking is showing signs of slowing down, given that the inventory declined 9.5% over the preceding 10-day period.