SHANGHAI, Sep 24 (SMM)—Steelmakers in Shaanxi, Shanxi, Gansu and Sichuan held a summit in Shaanxi Xi’an on September 23, reaching an agreement on output cuts.
Smelters in the four provinces decided to reduce the supply of construction steel by about 32,000 mt per day through shutting down blast furnaces, reducing the proportion of scrap steel and bringing forward maintenance, a move aimed to ease supply pressure and maintain market discipline.
High production costs, weaker-than-expected demand and sluggish steel prices forced these steel mills to trim output. Steelmakers in the four regions had also negotiated to reduce output by 64,700 mt/day at the start of this year, but failed to reach the target. But this time, some steel mills have already scheduled maintenance and will implement in the near term, SMM learned.
As of September 23, construction steel prices in the four provinces were the lowest in China, with spot rebar prices in Sichuan Chengdu falling to 3,590-3,600 yuan/mt.
