gui yong nian/Adobe Stock
Global crude steel production took a fall in October, including in No. 1 steel producer China.
According to statistics compiled by the World Steel Association — using data from 64 data-reporting countries — global steel production fell 2.8% in October on a year-over-year basis.
October production from the reporting countries totaled 151.5 million tons, down from the 155.8 million tons produced in October 2018.
China’s production contracts
China’s crude steel production for the month dropped 0.6% year over year to 81.5 million tons.
In September, China’s production growth reached 2.2% year over year, while August growth reached 9.3%.
With the Chinese winter heating season underway, it remains to be seen how much steel capacity is shuttered for the season.
As MetalMiner’s Stuart Burns recently noted, the government is taking a closer look at new capacity starts.
“Demand in top consumer China remains surprisingly robust, yet inventories are falling — suggesting producers are struggling to keep up with demand,” Burns wrote.
“If that were not enough, Reuters reported new starts are being more vigorously investigated and the approval process reviewed, leading the industry to think supply will be curbed further during the winter heating period this year.
“A notice jointly issued by the National Development and Reform Commission, Ministry of Industry and Information Technology (MIIT) and the National Bureau of Statistics urges local governments and the State-owned Assets Supervision and Administration Commission (SASAC) to verify the steel firms’ capacity, production and fixed-asset investments.”
No. 2, 3 producers see production declines
Meanwhile, No. 2 producer India put out 9.1 million tons, down 3.4% year over year. Japan produced 8.2 million tons, marking a 4.9% decline.
South Korean production reached 6.0 million tons, down 3.5% year over year.
U.S. production totaled 7.4 million tons, which marked a 2.0% decline compared with October 2018. The U.S. steel sector’s capacity utilization rate remains above the important 80% mark (identified as a marker of industry health when the Trump administration first rolled out Section 232 tariffs on imported steel and aluminum).
The American Iron and Steel Institute (AISI) recently reported the U.S. steel sector’s capacity utilization rate for the year through Nov. 23 reached 80.3%, having now held at that level over the past month and a half.
In the E.U., Germany produced 3.3 million tons, marking a year-over-year decline of 6.8%, as overall recession concerns loom in the E.U.’s industrial stalwart.
Italy produced 2.2 million tons, down by 3.7%. France’s production fell 10.6% to 1.2 million tons, while Spain’s fell 7.6% to 1.2 million tons.
October steel production in Brazil, Turkey and Ukraine was all down by double-digit percentages in each country — 19.4%, 15.0% and 12.7%, respectively.