Furnaces in China’s steelmaking complexes appear to be responding to the widely reported gloomy situation in that nation’s apartment tower construction sector, based on July 2024 steel output figures provided to the Brussels-based World Steel Association (Worldsteel).
Figures provided by the China Iron & Steel Association (CISA) to Worldsteel indicate the nation produced 82.9 million metric tons of steel this July. That figure is down 9 percent from last July’s output, and year to date through the first seven months of this year, China’s output has declined by 2.2 percent from last year.
Even with the reduced output, China made more than half of the steel produced in the world this July, which remains a source of concern for steel producers in other regions.
In the outlook section of comments accompanying its second-quarter results, Luxembourg-based ArcelorMittal says global market conditions created by China’s output are “unsustainable.”
“China’s excess production relative to demand is resulting in very low domestic steel spreads and aggressive exports; steel prices in both Europe and the United States are below the marginal cost,” the company writes.
July and year-to-date steel output in two of America’s leading ferrous scrap export destinations—Turkey and India—have increased, but that has not necessarily helped boost scrap prices in the U.S.
Turkish EAF mills, rather than bidding U.S. scrap prices higher, have been buying billet from Chinese exporters desperate to find a market, according to pricing and news service Davis Index.
“Most Turkish mills are uninterested in ferrous cargo purchases due to falling prices for imported billet from China,” the news service says, adding that the end market for Turkish semifinished and finished steel is “sluggish” and does not have improved sales prospects in sight.
The news service also says mills in India are engaging in similar behavior, with U.S. Census Bureau statistics indicating less outbound ferrous scrap heading to India this year despite its steelmaking output having risen by 7.2 percent through the first seven months of this year. (Turkey’s output is up by 14.9 percent year on year.)
Globally, crude steel production this July for the 71 countries reporting to Worldsteel was 152.8 million metric tons, with that figure representing a 4.7 decrease compared with July of last year.
In addition to China, July year-on-year output also decreased in Iran (-18.7 percent), Japan (-3.8 percent), South Korea (-3.4 percent) and Russia (-3.1 percent), according to estimates and figures provided to Worldsteel.
Companies with improved July 2024 output compared with last year include Brazil (+11.6 percent), India (+6.8 percent), Germany (+4.8 percent), Turkey (+4 percent) and the United States (+2.1 percent).
Courtesy : recyclingtoday.com