China's steel output reached a record high in October. The country's steel industry boosted for three straight months as they rush their production before winter cuts kick in.
China is known as the world's top steel producer and last month it produced around 82.55 million tons of crude steel. It is significantly higher than September's output of 8.85 million tons and October last year's 72.36 million tons. The data was released by the National Bureau of Statistics (NBS) on Wednesday. It is the highest recorded monthly output of the country's steel industry since 2010.
Reuters calculations, however, showed that the average daily production decreased by 1.2 percent from September to 2.67 million tons. The demand for steel in blast furnace mills within the country increased to approximately 68.65 percent in mid-October according to the data gathered by the Mysteel consultancy which was released Friday.
Hebei, the major steel producer province in Northern China ordered steel mills to decrease production during emergency periods after they issued a second-level pollution alert. The alert, however, did not affect the country's production record.
Beijing is implementing policies to fight toxic emissions during winter. Starting mid-November, still, mills are expected to slow their operations following the production restrictions implemented.
Tangshan, Hebei's top steelmaking city, has ordered the still mills to reduce their output by an average of 30-35 percent dependent to their emission levels. Handan, its second steelmaking city, will decrease their production around 48 percent.
China is expecting that steel production output in the coming months will decrease following the curbs implemented in its cities. This year, Cities in the central and eastern China will also implement restrictions in their productions following the 28 cities in northern China.
NBS reported that the output over the first ten months of the year was 782.46 million tons. It increased by 6.4 percent compared to last year's record during the same months.
According to MetalMiner, China's record production output and low capacity utilization rates will continue to put price pressure on global steel markets. They added that historically, the winter production curbs really don't dent the glut of excess steel produced by China. The website also noted that the excess capacity and sluggish demand suggest a weaker global steel price environment in which buying organizations will want to pay careful attention to actual emissions cuts to see if Chinese prices will rise.
