Friday, May 13,
China’s total steel output growth is set to fall in the coming months amid a worsening power shortage.* So, it might cause the country’s coking coal demand to ease, an official from the China Iron and Steel Association said on Thursday.
“The power cuts will accelerate the consolidation of the steel sector as it forces smaller and less efficient mills to shut,” Wang Yingsheng, head of CISA’s market research division, said at conference.
“Overall output will slow in the coming months and that means demand growth for coking coal will moderate,” he said, adding that slower auto sales were also contributing to weaker steel demand.
Power shortages during the peak summer and winter season have become a norm in China, the world’s largest steel producer. Energy intensive and high-polluting industries, such as steel mills, are always one of the first sectors to be slapped with power rationing.
Analsyts have warned that a lengthy and severe power crisis could dent China’s steel output and weigh on international iron ore and coking coal prices.
Leave a Reply