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Chinese crude steel output hits record high in April

Steel News - Published on Wed, 15 May 2019

Image Source: SteelGuru
Argus Media reported that China's crude steel output reached a record high in April as an uptick in prices and profits prompted mills to crank up production. April crude steel production was higher by 5.85% on the month and by 12.7% YoY at 85.03 million tonne, according to the national bureau of statistics data. The previous record was 82.55 million tonne in October 2018.

Daily crude steel output in April was 2.83 million tonne compared with 2.59 million tonne in March.

Cumulative crude steel output increased by 10.1% to 314.96 million tonne during January to April.

Monthly pig iron ore output rose by 10.1% on the year to 69.83 million tonne, while cumulative output was higher by 9.6% at 262.65 million tonne.

Construction work picked up pace in April ahead of the onset of hot and wet season in south China this month. Robust growth in real estate investments has also supported steel market sentiment. Mill margins may take a dent this month as construction demand has slowed, while the US-China trade war has added to anxiety about China's economic outlook. Steel production restrictions in Tangshan city to curb emissions this month may also slow production, although the implementation of these curbs is seen as lax by steel market participants.

China's overall manufacturing output growth slowed to 5.4% YoY in April, down from 8.5% in March. Cumulative January to April output growth was at 6.2%. The key steel consuming sectors of auto and equipment manufacturing posted sluggish growth of 1.1% and 2%, respectively, in April, but other transportation manufacturing, such as railway, shipbuilding and aerospace, grew by 5.8%.

Real estate investment grew at a scorching pace of 11.9% in January to April compared with a 9.5% growth in 2018. New project starts grew by 13.1% during this period.

A robust real estate sector will continue to offer strong support for steel and iron ore prices in the near term, much as it has done since 2016. Construction consumes more than 60% of China's steel output.

But real estate sales declined by 0.3% in area terms for January-April but posted an 8.1% growth in yuan terms, indicating a sharp jump in property prices, which is positive for future project starts and steel demand. Housing inventories fell by 9.4% on the year in area terms.

Infrastructure investment growth in January to April was unchanged from January to March at 4.4%. Infrastructure investment growth has so far not shown any sharp acceleration this year. This is despite Beijing's goal of spurring infrastructure building through the issuance of special bonds to provinces for projects and announcement of several urban and transport infrastructure projects over the past few months.

Source :

Posted By : Rabi Wangkhem on Wed, 15 May 2019
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