Daily Steel Output Slumps To 7-Month Low In Oct

China's daily crude steel output continued to slow down in October, with production witnessing a significant month-on-month decline to touch a seven-month low of 2.31 million tonnes/day, according to Mysteel's latest survey among 247 blast-furnace and 101 electric-arc-furnace steel producers across the country. Respondents blamed frequent production stoppages last month as local governments battled air pollution.

The October result represented a hefty decrease of 142,800 t/d or 5.8% compared with that for September, mainly thanks to a series of production restrictions on steel mills in major steel production bases including North China's Hebei and Shanxi provinces, Central China's Henan province, East China's Jiangsu, Shandong and Anhui provinces starting from late September till early October. Provincial and city government authorities told mills to curb operations to improve air quality during celebrations for the country's 70th birthday on October 1, as reported.

But it wasn't just the National Day festivities that occasioned production cuts. During October 18-22, steelmakers in Tangshan city in North China's Hebei province were subject to a new round of tougher operational restraints because poor air quality was forecast. Tangshan city requested local steel mills in specific districts in Tangshan, including Kaiping, Guye, Fengnan and Fengrun to only operate one blast furnace each during that period, and those mills with only a single blast furnace were required to limit their production by half, Mysteel Global notes.

Production resumed gradually nationwide after the stricter restrictions were lifted, with the average blast furnace utilization rate among the 247 BF steelmakers across China reversing up again over the October 25-31 week to 78.48%, up 1.24 percentage points on the week. This was also the highest level after the record low of 70.33% was hit over September 27-October 3, according to Mysteel's data.

Therefore, for the last eleven days of October as more steel mills resumed operations, domestic daily crude steel production increased slightly, gaining 19,100 t/d or 0.8% from mid-October to 2.36 million t/d, Mysteel's latest survey showed.