As per the recent data released by NBS (National Bureau of Statistics), Chinese crude steel output reported surge by 14% on quarterly basis to 261.65 MnT in Q2CY19 which was 229.91 MnT in previous quarter of similar year.Amid higher profit margins and optimistic demand in the beginning of the quarter motivated Chinese steelmakers to ramp up steel output.
However with the announcement of recent production cuts in Tangshan region towards the end of last month with the motive to prevent excess capacities and control air quality resulted to decline in nation’s monthly crude steel output in June’19.
On monthly basis China’s crude steel production inched down by 2% in Jun’19 to 87.53 MnT which was 89.09 MnT in May’19.
Constant efforts of Chinese government to bring forward capacity cuts and anti pollution measures in long term to meet annual air quality targets resulted to decline in output in June’19. However prior this,in May’19 China’s crude steel output recorded new high at 89.09 MnT.
Outlook for Jul’19- As per market reports,China will continue to imposed strict production cuts in winter season also in order to improve air quality.Meanwhile steel prices may remain volatile since demand from construction sector continued to remain low in month of July.Thus recent production curbs and lower demand may result to decline in nation’s crude steel volumes in upcoming months.
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