International credit ratings agency Fitch Ratings has stated that it expects that steel output in China will increase in the second quarter of this year once construction activities revive with the warmer weather conditions.
According to the agency, higher margins are projected to spur Chinese steel producers to further increase their outputs. In the first quarter this year, crude steel output in China declined by two percent year on year amid weak margins and demand and so steel producers began plant maintenances.
In the meantime, the average selling price for steel in the given quarter dropped by a high single-digit figure compared to the first quarter of 2023, while iron ore prices rose by seven percent and coking coal prices declined by five percent, both on year-on-year basis. Yet, starting from March this year, the margins of Chinese steel producers improved since raw material costs began to decrease, Fitch noted.
In late April this year, the average aggregate daily crude steel output of large and medium-sized steel enterprises in China totaled 2.1994 million mt, as SteelOrbis reported previously.
