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Recycling Today archives
Furnaces in China’s steelmaking complexes appear to be responding to the widely reported gloomy situation in that nation’s apartment tower construction sector, based on July steel output figures provided to the Brussels-based World Steel Association (Worldsteel).
Figures provided by the China Iron & Steel Association (CISA) indicate the nation produced 82.9 million metric tons of steel this July, down 9 percent from last July’s output and, year to date through the first seven months of this year, down 2.2 percent.
Even with the reduced output, China made more than half the steel produced in the world this July, which remains a source of concern for steel producers in other regions.
In comments accompanying its second-quarter results, Luxembourg-based ArcelorMittal says global market conditions created by China’s output are “unsustainable.”
“China’s excess production relative to demand is resulting in very low domestic steel spreads and aggressive exports; steel prices in both Europe and the United States are below the marginal cost,” the company writes.
July and year-to-date steel output in two of America’s leading ferrous scrap export destinations—Turkey and India—have increased, but that has not necessarily helped boost scrap prices in the U.S.
Turkish EAF mills, rather than bidding U.S. scrap prices higher, have been buying billet from Chinese exporters desperate to find a market, according to Davis Index.
“Most Turkish mills are uninterested in ferrous cargo purchases due to falling prices for imported billet from China,” Davis Index says, adding that the end market for Turkish semifinished and finished steel is “sluggish” and does not have improved sales prospects in sight.
Davis Index also reports mills in India are engaging in similar behavior, with U.S. Census Bureau statistics indicating less outbound ferrous scrap heading to India this year despite its steelmaking output being up 7.2 percent through the first seven months of this year. (Turkey’s output is up by 14.9 percent year on year.)
Globally, crude steel production in July for the 71 countries reporting to Worldsteel was 152.8 million metric tons, a 4.7 percent decrease compared with July of last year.
In addition to China, July year-on-year output also decreased in Iran (-18.7 percent), Japan (-3.8 percent), South Korea (-3.4 percent) and Russia (-3.1 percent), according to Worldsteel.
Companies with improved July output compared with last year include Brazil (+11.6 percent), India (+6.8 percent), Germany (+4.8 percent), Turkey (+4 percent) and the United States (+2.1 percent).
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