World crude steel output up by 5% y-o-y on improved utilization in Jan '21

Global crude steel output of 64 steel producing countries in Jan '21 was 162.90 mn t, up by 5% y-o-y against 155.44 mn t, as per the latest statistics released by World Steel Organization.

The ramp-up of production capacities on recovering demand along with increasing economic activities across the globe led to this surge. Global steel demand got a boost with the recovery in downstream sectors such as automobiles, heavy machinery, white and yellow goods.

"The governments of many countries, particularly China, are implementing infrastructure programs in response to the economic fallout of the coronavirus lockdown measures. These are driving steel demand and production," shared a credible industry source.

SteelMint has analyzed the crude steel production of the top three steel producing nations as mentioned below:

China registered 6.80% y-o-y surge in crude steel output in Jan '21-China, the world's top steelmaking country registered a rise of crude steel production at 90.20 mn t last month, up 6.80% y-o-y compared to Jan '20.

In Jan '20, the outbreak of COVID-19 had weighed on the production volumes. However, the economic recovery on the back of stimulus packages announced by the government in the second half of the CY '20, saw the demand rising leading to increased production.

Further, the Chinese Government is working towards increasing the use of electric arc furnaces to produce steel and reduce the carbon emissions.

India's crude steel output rose 7.60% y-o-y in Jan '21-India, the second largest steel producing country, registered crude steel consumption at 10.00 mn t, up 7.60% y-o-y in Jan '21. India's crude steel consumption was driven by robust domestic demand from white goods, infra and construction sectors.

Indian steel mills reported an increase in the average capacity utilization at 93-96% during the month of January. The resumption of the stalled construction and infrastructure projects along with the announcement of new projects in the last few months pushed the manufacturers to produce more.

Further, a few Indian steel producers are planning on capacity expansion while a few continue to ramp-up the current capacity utilization rates.

Japan's crude steel output dropped by 3.90% y-o-y for eleventh consecutive month in Jan '21-Japan's crude steel production for Jan '21 stood at 7.90 mn t, down 3.90% y-o-y, due to the resurgence of COVID-19 in Nov '20.

However, the demand, especially from automakers and industrial machinery makers has started the economic recovery aided by easing of COVID restrictions in mid-Feb '21. With one more blast furnace restarting its operation in Jan '21 the output is expected to improve further.

Japan's crude steel output, including both carbon and special steel, is anticipated to rise by 8% to about 23.7 mn t over Jan-Mar quarter, according to the survey released by Japan's Ministry of Economy, Trade and Industry (METI), indicating the further improvement in steel demand. However, uncertainties in Covid-19 spread persists and steel mills may need to monitor the situation closely and adjust their production plans to match the actual demand.