China Crude Steel Output Hits Record High 173.5 MT for January-March

National Development & Reform Commission (NDRC) of Chinese government announced on Thursday crude steel production in China is estimated at 173.5 million tonnes for January-March, which would increase by 9.8% year-to-year compared with the same period of 2010 and hit the record high as January-March. In March, the monthly production was likely to increase by 9.2% to 59.325 million tonnes from February, rebounding after 2 months, and to increase by 7.9% from a year earlier, year-to-year plus for 5 consecutive months.

Chinese steel makers are increasing output of steel products when the demand is seasonally increasing for building construction and civil engineering. On the other hand, oversupply is concerned since the government enhances macro-economic adjustment by rate rise and Chinese car production recently slow down.

China Iron & Steel Association announced crude steel output per day was 1.931 million tonnes in January, 1.939 million tonnes in February and 1.914 million tonnes in March. Steel makers increased productions when steel market price rose from the yearend of 2010 to mid February. Meanwhile, steel makers didn’t lower operations despite of steel market price down after Chinese New Year in mid February.

Steel demand is expected to enter high season in 2011 along Chinese government’s new 5-year plan including urbanization and long-life house construction. The country’s steel export increased by 20.7% to 10.51 million tonnes for January-March compared with the same period of 2010. NDRC forecasts steel export increases to Japan due to Japan Earthquake.