China Raw Steel Output to Hit First 600 Million tonnes in 2010

Chinese raw steel output increased by 10.1% to 575.27 million tonnes in January-November from same period of last year, announced by Chinese authority on Monday. The output will exceed first 600 million tonnes in the full year. The output of steel products would mark a record at slightly less than 800 million tonnes through December. The range of increase narrowed. However, the output is increasing due to strong domestic demand. The Chinese raw steel output would be about 45% of 1.4 billion tonnes of estimated world output in 2010. The Chinese steel output would increase the impact on the world’s industry when the raw steel output will increase by around 12% per year through 2015, according to Ministry of Industry and Information Technology.

The raw steel output decreased to less than 50 million tonnes in September due to power restriction by the government. However, small and medium sized steel makers are increasing the output mainly for price recovering construction materials seasonally. The raw steel output increased by 4.8% to 50.17 million tonnes in November from October, which increased for the first time in 4 month.

The raw steel output per day increased by 3.0% to 1.672 million tonnes in November from October, which increased for 2 months in a row. The output of steel products increased by 0.9% to 65.89 million tonnes in November from October, which increased for the first time in 3 months. The products’ output increased by 15.7% to 730.29 million tonnes in January-November from same period of 2009. The output would stay high in December when the iron ore import increased by 25.5% to 57.38 million tonnes in November from October.

The raw steel output would top estimated 578.7 million tonnes in 2010 by World Steel Association. The higher output resulted in higher Chinese steel export. World Steel Association expects Chinese steel demand will increase by 3.5% in 2011 but the higher production could expand overproduction.