Blast furnace capacity utilization in China falls for third week

The blast furnace (FF) utilization rate among 247 Chinese steel mills surveyed by Mysteel fell another 1.32 percentage points on the week for the third consecutive week to 86.31% compared to the period Oct. 28 to Nov. 3, indicating that some of the surveyed factories continued to operate. containment of production against the backdrop of persistent losses in profits and sluggish demand for steel from end users.

During the last reporting period, pig iron production at these plants declined by a further 35,600 tons per day for the week, respectively, to 2.33 million tons per day on average, while the productivity of blast furnaces decreased by 2.71 percentage points in the fourth week. a week to 78.77. % on November 3rd.

“The approach of cold weather in some regions of China has greatly affected outdoor construction work, leading to seasonally sluggish demand for steel in the physical market, which will further pressure steel prices,” a market watcher from Shanghai commented.

For example, the daily trading volume of structural steel, including rebar, wire rod and coiled bars, among the 237 Chinese trading houses monitored by Mysteel averaged a relatively low level of 158,626 tons/day between October 29 and November 3.

And the national price for 20mm HRB400E rebar was estimated by Mysteel to drop 99 yuan per tonne ($13.5 per tonne) in a week to 3,890 yuan per tonne, including 13% VAT as of November 3rd.

Meanwhile, another study by Mysteel found that only 9.96% of those 247 plants were profitable as of Thursday, down 17.75 percentage points on the week and 61.9 percentage points on the year, or hitting a new low since January 2016.

Under such conditions, steel mills across China had 22 blast furnaces idle during the survey period, according to a market watcher.