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Kallanish Kallanish

Knowledge matters Knowledge matters

April, 21st 2019

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AUG 10

Weaker Chinese July steel output signals demand slide


China’s major steelmakers saw output fall again in late July suggesting restrictions were having some effect, although output was still higher than a year earlier. Kallanish expects data released Tuesday to show output and demand fell month-on-month, but continues to grow from 2017.

In the last eleven days of July, China’s major steelmakers produced on average 1.91 million tonnes/day of crude steel, according to the China Iron and Steel Association (CISA). That was down -2.5% from mid-July, but still 3% higher year-on-year. Finished steel inventory held at mills also dropped -7.45% over the period to 11.44mt, CISA said.

National crude steel data will be released this week and is expected to show a fall from June. Working on this assumption, Kallanish expects the data to show end user buying was down another -5.6% in July. That would still leave demand considerably higher than last summer however, and over January-July, end user demand is still expected to be up some 6.4%.