SMM4, March 27 / PRNewswire-Asianet /-- (CISA) of the China Iron and Steel Association said in a statement on Wednesday that weak demand for alloys will recover strongly in the second quarter as new investment in production infrastructure begins and the industry resumes operations after the coronavirus downturn.
Due to the decline in economic activity in the first quarter, China's steel consumption plummeted, and the downturn in domestic and foreign demand hit prices and exacerbated the surge in inventories.
China's steel price index hit 96.86 in the second week of April, its lowest level since May 2017. At the beginning of April, inventories of major steel companies reached 17.95 million tons, an increase of 88.32 per cent over the beginning of the year.
The rebound in production is expected to be driven by China's enhanced residential renovation program in old urban areas this year, which has been upgraded by 39000 communities and is expected to benefit 7 million families.
Anglo-Australian mining giant BHP Billiton (BHP) said it expects steel furnaces to increase production this year, as long as China does not face a second wave of infection.
Jean-Sebastian Jacques, chief executive of Rio Tinto's (Rio Tinto), said last week that China's resumption of industrial activity would once again stimulate demand in the world's largest consumer of raw materials.
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