The blast furnace (BF) capacity utilization rate among 247 Chinese steel mills under Mysteel’ssurvey had dropped for the fourth straight week by another 2.23 percentage points on week to 84.09% over November 4-10, touching a new low since mid-August.The constant decline indicated that more mills had trimmed steel production in reaction to their persistently thinning margins or widening losses, Mysteel Global noted.
During the latest survey period, the mills’ daily hot metal output had also decreased for the fourth week by another 60,100 tonnes/day on week to 2.27 million t/d on average, and their BF operational rate had slid for the fifth week by another 1.57 percentage points on week to 77.21% as of November 10.
The lower-than-expected steel demand from end-users and negative market sentiment continued to weigh on Chinese steel prices, forcing more mills to conduct maintenance stoppages or slow down their production pace so as to reduce the losses they were suffering, Mysteel Global learned.
For example, Mysteel’s other survey showed that only 19.05% of the same 247 mills were making profits as of Thursday, 30.74 percentage pointslowerthan the same period last year.
Under such circumstances, another 15 BFs across the country had been idled over the survey period, according to a Shanghai-based market watcher.
Consequently, the daily consumption of imported iron ore among the surveyed mills decreased by 66,800 t/d on week to 2.83 million t/d on average over November 4-10.
By Thursday, these mills’ total inventories of imported iron ore in all forms including the volumes at steelworks, port stockyards and on the water had nudged down for the third week by another 602,800 tonnes on week to 93.15 million tonnes. Their ore stocks would be sufficient to last for 32.94 days of use, or 0.55 day longer than the previous survey period.
Written by Lindsey Liu, liulingxian@mysteel.com
This article has been published under an article exchange agreement between Mysteel Global and SteelMint.
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