SHANGHAI, Dec 11 (SMM) – China’s production of hot-rolled steel looks set to trend higher this month, as a slew of mills will recover from maintenance amid enticing profits.
An SMM survey showed that Chinese steelmakers plan to produce 9.29 million mt of hot-rolled steel in December, up 4.75% from the realised output in November.
About 405,000 mt would be exported, up 5.5% from a month earlier, and volumes slated to enter domestic markets are likely to increase 4.7% to 8.88 million mt.
There are no maintenance scheduled for major hot-rolling mills this month, compared to about 429,200 mt of production affected by maintenance works in November.
Improved production enthusiasm also contributes to higher hot-rolled steel production, as higher spot steel prices recovered profits among steelmakers.
Prices of spot hot-rolled coil kicked off a rally since early November, as transport restrictions slowed shipments to spot markets and as Beijing’s economic stimulus measures and hopes for a preliminary US-China trade deal brightened the outlook for steel demand and improved market sentiment.
Some mills have shifted to rebar production, given the spread between profits on rebar and HRC. This, however, is not enough to lead to a decline in overall hot-rolled steel production.