China Crude Steel Production in May 2021 at New Monthly Record
China’s crude steel output hit a monthly record in May 2021, rising 1.6% MoM from April 2021 following resilient downstream demand and firm profit margins, despite a steep drop in margins towards the end of the month. According to latest National Bureau of Statistics data, China produced 99.45 million tonnes of crude steel in May 2021, compared with 97.85 million tonnes of output in April 2021 and was 7.7% higher than in May 2020. However, average daily output of 3.206 million tonnes crude steel in May fell by 1.6% MoM from 3.261 million tonnes in April. In the first five months of 2021, China produced 473.1 million tonnes of crude steel, up 13.9% YoY, which translate to average monthly production of 94.62 million tonnes to take annualized figure of 1.135 billion tonnes for 2021, up by about 7% YoY as compared to 1.065 billion tonnes in 2020.
However, contrary to continued surge in crude steel production in China since May 2020, a report in Global Times has highlighted that China's largest steel producing Hebei Province has continued to reduce excess capacity with the number of steel production enterprises reduced from 107 to 68 and steel production capacity has been reduced from a peak of 320 million tonnes to less than 200 million tonnes. Hebei Daily reported that “The province is on track to achieve its goal of withdrawing iron and steel production from the city and relocating 150,700 workers with a resettlement rate of 100%.”