China’s crude steel output in May climbed 8.1% from the previous month and was up 2.7% from the year before, according to data from the National Bureau of Statistics (NBS). The world’s largest steel producer manufactured 92.86 million metric tons of crude steel last month, the highest for a single month since March 2023, compared to 85.94 million tons made in April.
The increase in output was attributed to improved domestic demand and robust exports. Steel exports jumped by 4.45% from the prior month to 9.63 million tons in May, according to customs data. Additionally, some electric-arc-furnace-based steelmakers resumed production, and steel produced from the blast furnace process also picked up, partly driven by rising steel prices.
An average of 53% of steel mills operated at a profit in May, compared to 45% in April, data from consultancy Mysteel showed, further indicating improved market conditions.
However, analysts expect steel output in June to fall as demand was curbed by high temperatures in summer, heavy rains in southern regions, and as steel margins thinned. China produced a total of 438.61 million tons of crude steel from January to May, down 1.4% year-on-year.
Looking ahead, analysts at state-backed investment bank CICC forecast China’s crude steel output in 2024 to fall 1.1% from the previous year, and real steel consumption to slide by 1.2% on the year.