Challenging times for China’s steel industry

China’s crude steel output for 2014 is likely to be 830Mmt, according to the Chinese Iron & Steel Association (CISA). This means that China will produce 2.2Mmt per day.

The country’s key steel mills saw crude steel output rise by 0.53% to 1.8Mmt over the first 10 days of August, according to CISA. By 20 August, steel inventories at the mills amounted to 15.2Mt, up 4.68% from 10 August.

Five out of 21 steel mills listed on the Shanghai and Shenzhen stock exchanges incurred losses, except Baosteel, which turned a profit of 3.15 billion yuan ($489 million) – roughly the same as the net profits of all 21 steel companies put together.

The biggest loser of the 21 companies was Shaoshan Iron and Steel, which suffered a loss of 736 yuan ($120 million).

The Chinese Ministry of Industry has announced that 132 companies active in steel refining, ferroalloy, copper refining, cement, panel glass, paper, leather, printing and dyeing and lead storage battery or rare earth will be shut down in an effort to eliminate outdated production capacity.

Source: China Metals.-------