The Overall Output of Steel Mills Decreased Sharply due to the Raw Material Shortage and Other Aspects

SHANGHAI, May 9 (SMM) - In April, due to the shortage of imported nickel raw materials, the high cost amid the extreme LME nickel, the limited transportation under the pandemic situation, and the goods backlog of steel mills, most steel mills stopped production or switched from 3 series to 2.4 series, and the overall output of steel mills decreased sharply. Due to the high imported nickel raw material prices, some steel mills have transferred their demand to the stainless steel scrap, so the supply of stainless steel scrap was relatively limited, which also limited the production of some steel mills with a high proportion of steel scrap in the south. Therefore, the output in April decreased significantly compared with that in March. In April, the output of stainless steel was basically the same as that of the previous year, with a decrease of 1% YoY. In May, SMM expects the overall output may still decline slightly compared with April. Among them, the ferrochrome prices increased due to the shortage of imported nickel raw materials, the pandemic situation, and the flood in South Africa. As a result, the series 2.4 profits of some steel mills have also been squeezed or even were negative and there was a certain reduction in series 2.4 in May. While the output of series 3 stainless steel remained basically the same as that in April. 200 series stainless steel decreased by 4.35% and 400 series stainless steel decreased by 7.5%. SMM national stainless steel output statistical samples includes Dingxin Industry, Tsingtuo Nickel Industry, Qingtuo Industrial, Tsingshan Group, Guangqing, Beigang New Material, TISCO Stainless Steel, Zhangjiagang Pohang, Ansteel, Jiugang and Taishan Steel Group, Jiangsu Delong (including Danan project + Xiangshui phase II), Eastern Special Steel, Xinjinhui Stainless Steel Industry, Baosteel Desheng, Fujian Wuhang Stainless Steel Products, Fuxin Special Steel, Inner Mongolia Shangtai Industry, Yantai Walsin Lihwa, Huale Alloy, Yongxing Materials, Shandong Shengyang, Guangxi Jinhai, Liuzhou Steel Zhongjin, Guangxi Yongda Steel, Guangxi Xinfeng, Wolaidi Metal Material, Shenyuan Special Steel, Sichuan Gangchen, Friendship Special Steel, Taizhou Huadi, Ningbo Dongmeng, Jiangxi Shengda and Ningbo Yiyue, totaled 35.