SHANGHAI, Apr 22 (SMM)—Operating rates of blast furnaces at steel mills stood at 85.8% as of April 22, an increase of 1.3 percentage points both week-on-week and month-on-month, SMM survey showed. More districts in Hebei were under production restrictions this week, but blast furnaces in other regions restarted production due to decent profits.

Operating rates of blast furnaces at Chinese steel mills

The Handan City's Production Control Plan for Key Industries in the Second Quarter of 2021 was released this week, and green performance evaluations were conducted on key industries such as steel (including independent pellets), coking, cement, and foundry. Besides, strip steel mills in the Fengrun District suspended production on the evening of April 21, which boosted rebar and HRC prices to new highs. The Ministry of Industry and Information Technology and the National Development and Reform Commission have recently met to discuss specific measures to reduce production by 20 million mt. However, domestic crude steel output in Q1 did not decline but increased by 36 million mt compared with the same period last year, which means more areas will be under production restrictions in the rest of the year in order to achieve the annual output cut target. Steel consumption is likely to peak in the short term, and exports are expected to fall after May. Steel prices may fall after market participants digested production restrictions.