China: Steel user-industries maintain steady growth y-o-y in Jan-Aug'21

The downstream steel sector in China registered a slow but steady growth in Jan-Aug'21 compared to last year (Jan-Aug'20). However, the performance of the Chinese steel industry remained affected by the repeated Covid-19 resurgence, hot rainy weather and slowdown in exports, weak demand in August and y-o-y drop in land purchase area, SteelMint learnt.

Sector-wise growth rate

Construction: Investments in infrastructure in China continued to drop at a narrowed rate. In Q1CY'21, infrastructure investments recorded a growth of 29.7% y-o-y which, coming towards H1CY'21, registered 3.8% growth y-o-y. In Jan-Aug'21, the growth rate subsided to 2.9% y-o-y. In Aug'21, it registered a 7% de-growth y-o-y.

On the other hand, investments in China's real estate sector recorded a y-o-y growth of 25.6% in Q1CY'21 and 15% in H1CY'21. In Jan-Aug'21, the same slowed down but registered a positive growth of 10.9% compared to the same period last year, with expanded decline in newly started construction areas and land purchase areas. Active real estate construction areas rose 8.4%, newly-started construction declined 3.2%, land purchase is down 10.2% while commercial house sales rose 15.9%, according to latest data released by the China Iron and Steel Association (CISA).

In Aug'21, the real estate growth rate was almost stable (+0.3%) y-o-y with commercial house sales declining by 15.6%, newly started projects down by 16.8% and land purchase down by 13.9% y-o-y.

Manufacturing: The output of the machinery industry varied according to different products, with growth rate of mechanical and electrical products continuing to decline.

Excavator output registered a sharp increase of 83.2% y-o-y in Q1CY'21. In H1CY'21, it recorded a double-digit growth of 25.6% y-o-y. In Jan-Aug'21, the growth rate was positive at 17.5% and in Aug'21, excavator output decreased by 24.6% y-o-y.

Automobile: Automobile production in China posted a significant rise of 81.7% y-o-y in Q1CY'21 while in H1CY'21, it grew by 24.2%. In Jan-Aug'21, China auto output saw 11.9% y-o-y increase to 16.17 million units while sales rose by 13.7% y-o-y to 16.56 mn units, showing a fall of 5.3% and 5.6% percentage points respectively compared with the growth rate of Jan-Jul.

In Aug'21, automobile output and sales respectively were recorded at 1.73 mn units and 1.8 mn units, down 7.4% and 3.5% respectively m-o-m and down 18.7% and 17.8% y-o-y.

Shipbuilding: Chinese shipbuilding industry braced for an uptrend, with continuous growth in new orders. In Jan-Aug'21, new shipbuilding orders increased by a mammoth 227.2% y-o-y against CPLY. However, in Aug'21, new orders increased by a whopping 281.40% y-o-y.

Home appliances: China's home appliance production noticed an increase y-o-y in Jan-Aug'21. The overall volume, however, slipped at an expanded scale. In Aug'21, China's home appliance output largely remained lower as compared to Aug'20.

Container: China's container industry kept quick growth, though growth rate slowed down slightly. Container production, in Jan-Aug'21, increased by 171.2% y-o-y while in Aug'21 only, it grew by 137.8%.