China's blast-furnace capacity use dips more slowly to 87.96%

The blast furnace (BF) capacity utilization rate among the 247 Chinese steel producers under Mysteel's regular survey had dropped for the fourth straight week, albeit by a tiny 0.05 percentage point on week to reach 87.96% over November 17-23. The pace of decline in the capacity use slowed down markedly compared with previous weeks, Mysteel Global noted.

During the latest survey period, daily hot metal output among the sampled steel mills also dipped 0.06% on week to 2.35 million tonnes/day, the survey showed, as some mills in Northeast, East, and Southwest China started their annual routine overhaul on their BFs.

However, the continuously recovering profit margins also encouraged some mills to increase their production, Mysteel Global learned. Over November 17-23, while five BFs across the country were shut off, eight idled ones were brought back online, leading the average operational rate among the 247 steel mills to pick up 0.45 percentage point on week to reach 80.12%, according to the survey.

Over the same period, around 39% of these mills were able to gain some profits on steel sales, higher by 10 percentage points than in the prior week, thanks to the firm rises in finished steel prices in the past few weeks, Mysteel's other survey showed.

For example, as of November 23, China's national price of HRB400E 20mm dia rebar under Mysteel's assessment gained Yuan 24/tonne ($3.4/t) on week to Yuan 4,068/t including the 13% VAT.

Meanwhile, the daily consumption of imported iron ore among the 247 steel mills under Mysteel's tracking averaged 2.9 million t/d during November 17-23, dipping 0.07% on week in accordance with these mills' reduced production.

By November 23, total imported iron ore inventories held by these mills mounted to 92.9 million tonnes, higher by 2.4 million tonnes or 2.6% on week, which would be sufficient to last 32.3 days of their use, longer by 0.9 day than in the previous period, Mysteel assessed.

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