China's BF capacity use rises further to 89.76%

Production among Chinese blast furnace (BF) steelmakers continued rising as more steel mills brought their idled furnaces back on stream after maintenance amid the slightly recovered steel margins, Mysteel's latest survey showed.

During June 14-20, the average BF capacity utilization rates of the 247 steelmakers under Mysteel's regular tracking increased for the second straight week by another 0.23 percentage point on week and refreshed the seven-month high at 89.76%, while their daily hot metal output also grew by 6,300 tonnes/day or 0.26% on week to 2.4 million t/d.

During the same period, the operational rates among these sampled BF steel mills averaged 82.81%, higher by 0.76 percentage point on week, the same survey showed.

More mills across the country restarted their blast furnaces after completing maintenance works over the latest survey week, Mysteel Global noted.

Meanwhile, domestic BF mills saw their profits improve marginally, thanks to the continuous weakening of the prices of steelmaking raw materials, Mysteel's other survey showed.

As of Thursday, around 52% of the 247 steelmakers Mysteel tracks could earn some profits on the sales of their steel products, higher by some 3 percentage points from the previous week.

In parallel with the increase in hot metal production, the daily consumption of imported iron ore among the same 247 steel mills went up by 11,000 t/d or 0.4% on week to reach 2.94 million t/d during June 14-20, according to Mysteel's tracking.

However, the mills were still cautious about ramping up production further, since they had seen the slack steel consumption among end-users, Mysteel Global noted. Consequently, their replenishment demand for steelmaking raw materials was not strong.

As of June 20, the total inventories of imported iron ore in all forms held by the 247 sampled mills stood at 92.1 million tonnes, lower by 357,800 tonnes or 0.4% on week, and the stocks would be sufficient to last them for 31.3 days at their current use rate, shorter by 0.2 day from the previous week, Mysteel assessed.

Note: This article has been written in accordance with an article exchange agreement between MySteel Global and BigMint.