According to a survey conducted in September among 91 blast furnace steel manufacturers, China's blast furnace steel producers suffered further losses in finished steel sales. The results of the latest monthly survey published show survey respondents mostly attribute these to further increases in production costs and blame the unimproved conditions.
Judging by October evaluations, blast furnace plants in China suffered more damage in September.
In September, the average losses in rebar sales of the factories included in the research were 152 Yuan/ton ($20.8/ton).
It also decreased by 97 Yuan/ton compared to the August average; losses in hot rolled coil sales amounted to an average of 91 Yuan/ton. The average profit of 67 Yuan/t made by producers in August can be added to these figures.
Decline continues in China
Blast furnace (BF) capacity utilization rate among 247 Chinese steelmakers continues to decline for the second consecutive week compared to October.
It came to the fore that steel mills in Northern China suspended the operation of their furnaces due to heavy losses. In the period of October 6-12, the figures decreased by 0.38 points weekly to 91.93%.
According to the latest research, the average daily hot metal production of factories decreased by 0.4% weekly to 2.46 million tons/day, while operating rates decreased by 1.21% points weekly to 82.2%.
For example, between October 5-11, the loss on billet sales of 10 integrated mills in the Tangshan region averaged RMB 279/ton ($38.9/ton), an increase of RMB 66/ton compared to the previous week.
Traders expected the market to be active after the eight-day holiday, local steel producers increased their iron ore purchases to replenish their stocks.
Imported iron ore stocks in the 247 facilities surveyed reached 88.4 million tons as of October 12, an increase of 1.8 million tons, or 2.1%, compared to the previous week. Stocks will be sufficient for 29.4 days of use at the current rate, 0.7 days longer than the previous period.