According to a new report issued by the China Iron and Steel Association (CISA), in January this year China’s crude steel output amounted to 67.58 million mt, up 0.54 percent year on year, while the average aggregate daily crude steel output of all CISA members - totaled 1.7443 million mt, up 0.17 percent compared to December.
According to the CISA’s report, as of the end of the third week of February overall domestic inventories of the main finished steel products in China totaled 16.55 million mt, down 37.28 percent year on year and rising by 74.74 percent compared to the beginning of the current year.
In January this year, China’s finished steel exports decreased to 7.42 million mt, down 4.9 percent month on month and declining by 23.8 percent year on year. In addition, there is
an increasing number of antidumping (AD) investigations against China’s steel exports, which will exert negative pressure on the domestic finished steel market from the supply side.
As also indicated by the CISA, as of the end of January this year domestic iron ore prices and import iron ore prices increased by 1.38 percent and 11.14 percent month on month and were up 62.81 percent and 65.71 percent year on year, while the composite steel price index (CSPI) for the Chinese domestic market only increased by 0.36 percent month on month, thereby exerting negative pressure on the margins of steel producers. Increased inventory levels of finished steel are expected to exert a negative impact on finished steel prices in the Chinese domestic market. It is thought that finished steel prices in China will likely edge down slightly in the coming period.