Blast Furnace Capacity Utilization In China Drops To 83.74%

Between September 10-16, blast furnace capacity utilization among 247 Chinese steel mills fell to a new low since early July, according to a Mysteel study, falling to 83.74% for the second straight week as Chinese steel surged. mills, especially those in Jiangsu in eastern China, have increased their production of finished and crude steel.

During the last period of the study, the production of molten iron at these plants decreased respectively in the second week by 27,300 tons per day per week to 2.23 million tons per day as a whole, and the productivity of their blast furnaces in the study also decreased in the second week. week by another 1.69 p.p. up to 71.88% as of September 16.

“The decline in molten iron production occurred mainly in Jiangsu province in eastern China, as more local steel mills have recently cut production further at the request of the local government,” said a Shanghai-based market analyst.

“Steel production in Jiangsu may decline further in the coming weeks as local authorities are forced to reduce energy consumption by energy-intensive industrial enterprises,” he added.

In addition, some steel mills in northern China also temporarily shut down their blast furnaces around September 15 to improve local air quality as the opening ceremony of the 14th China National Games was held in Xi'an, Shaanxi province in northwest China, Mysteel Global reported. sources.

As a result, according to Mysteel data, the daily consumption of imported iron ore at these surveyed enterprises decreased by another 32,800 tons /day to 2.73 million tons /day on average over the last study period, and the decrease in demand led to a decrease in Mysteel SEADEX by 62%. ... Fines in Australia fell to a new low since July 7, 2020, reaching $ 106.35 per tonne CFR in Qingdao, or down $ 23.25 per tonne over the week.

By September 16, import stocks of iron ore from these factories in all forms, including volumes in steel mills, port warehouses and on the water, fell for the eighth straight week by another 604,700 tons to 103.4 million tons, a new low since mid-March. 2020, although the volume will be enough for about 37.86 days of consumption, which is 0.23 more days per week.

In the most recent survey period, a smaller Mysteel study of 163 steel mills in China found that the utilization rate of their blast furnaces fell 0.52 percentage points over the week in the third week to 67.56% as of September 16.