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China’s crude steel output increased further in November as steelmakers rushed to boost production on price rises.
State-owned and large steelmakers who are also members of the China Iron & Steel Assn (Cisa) contributed most to the increase this month.
Daily crude steel output totalled 1.638 million tonnes in the first 10 days of November, according to the association.
This compares with 1.5195 million tonnes per day in the last 10 days of October.
This is also the highest level since late July, Cisa said.
National crude steel output, which includes the output of both Cisa members and non-member steelmakers, was up by 1.6% in early November, Cisa estimated.
The country’s crude steel output stood at 1.956 million tpd in the first 10 days of the month, up from 1.926 million tpd previously.
“The large rise in production has already put pressure on the market and may even lead to another round of price decreases if steel mills do not trim production as soon as possible,” a major trader in Shanghai said.
China’s hot rolled coil prices, which saw a strong rise in the first two weeks of November, have started to drop since late last week.
In Shanghai, commercial-quality HRC (4.5-12mm) was changing hands at 3,900-3,960 yuan ($620-630) per tonne on Tuesday November 20, down 20-30 yuan per tonne from Monday. This compares with last Thursday’s peak of 3,990-4,020 yuan per tonne.
Despite lower investment in the steel sector this year, China’s steel capacity is still on the rise.
Wang Xiaoqi, Cisa’s vice-chairman, said late last week that China’s total steel capacity would top 1 billion tonnes in 2012.
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