Bloomberg reported that China daily steel production in June climbed from the previous month, weighing on prices as a slowing economic expansion reduced demand.

Based on monthly data collated by the National Bureau of Statistics output was 2 million tonnes a day last month compared with 1.98 million tonnes in May and a record 2.02 million tonnes in April.

Crude steel production was 60.2 million tonnes in June and 61.23 million tonnes in May.

Mr Hu Yanping Custeel.com chief analyst said “China expanded 7.6% in the second quarter, the slowest pace in three years draining demand for the alloy used by builders and automakers and prompting price cuts by Baosteel Iron & Steel Co, China biggest publicly traded mill, Angang Steel Co and other producers. Chinese mills may cut output this month and next as they struggle to break even.”

He said that “The rebound in daily output is certainly bad news. It will drag down the already weak prices, further squeezing steelmakers’ profits.”

According to data from Beijing Antaike Information Development Co the average price of hot rolled coil a benchmark product has fallen for 13 straight weeks, the longest streak since January 2003. It lost 9.6% to CNY 3,974 a tonne from CNY 4,395 on April 13.

Source - Bloomberg

(www.steelguru.com)