China's rebar output dips 0.9% y-o-y in Jan-May

China's rebar production totaled 96.9 million tonnes over January-May, nudging down by 0.9% on year, as against the 1.2% incline in the prior four months, data from the country's National Bureau of Statistics (NBS) showed. As for May alone, the country's rebar output declined by 8.8% on year to 19.9 million tonnes, also lower by 5.6% compared with April.

The on-month decline in rebar output in May was largely attributed to the fact that many Chinese electric-arc-furnace (EAF) steel mills had trimmed their production in a bid to reduce their losses on steel sales, though some blast-furnace mills resumed operations in the second half of May, sources remarked.

The result was in line with Mysteel's survey findings, with the average capacity utilization rate among the 87 independent EAF makers nationwide under its tracking dropping by 6.89 percentage points month to 49.37% by the end of May.

Meanwhile, Mysteel's another survey among the 40 independent EAF mills showed that by end-May, these mills still suffered an average loss of Yuan 163/tonne ($22.8/t) when producing and selling rebar, widening by Yuan 83/t from a month earlier.

Despite lower output, China's rebar prices continued to retreat last month on feeble demand from end-users. As of May 31, the national price of HRB400E 20mm dia rebar, for example, was assessed by Mysteel at Yuan 3,680/t including the 13% VAT, slumping by Yuan 197/t from the end of April and registering the lowest level since May 9 2020.

During May, the daily trading volume of construction steel comprising rebar, wire rod and bar-in-coil among the 237 traders nationwide under Mysteel's regular survey averaged 156,699 t/d, shedding by 6,853 t/d or 4.2% on month.

The NBS data also found that rebar accounted for 16.8% of the 118.5 million tonnes of finished steel products China churned out last month. Rebar also contributed 17.4% of the 557.1 million tonnes of finished steel produced in the first five months.

Written by Rong Zhang, zhangronga@mysteel.com
Edited by Alyssa Ren, rentingting@mysteel.com

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