-- Chinese steelmakers slashed output last month as woeful demand forced steep cuts on an industry contending with a collapse in margins.Steel production in July plunged about 9% on both the month and the year to 82.94 million tons, the lowest figure reported in 2024, according to the statistics bureau on Thursday. That leaves the total over the first seven months at 613.72 million tons, 2.2% off last year’s pace.
“Market sentiment is really bearish,” he said. “Mills are losing money across the industry, but steel prices are not showing signs of stabilizing.” The steel industry has been plagued by overcapacity for years. In an effort to rein in emissions, Beijing has been trying to cap production at or below the previous year’s level after output ballooned in 2020 to well over 1 billion tons. That task is likely to be easier this year as supply discipline is forced on mills looking to buttress their margins. It could also offer some relief to the countries grappling with the impact of cheap Chinese exports on their domestic markets.
Aluminum output hit a record for a third straight month after smelters ramped up production in hydro-rich Yunnan province and new capacity was added in Inner Mongolia. Three Chinese steelmakers, including Baoshan Iron & Steel, were put on a downside 30-day catalyst watch by Citigroup, which is concerned about declining prices and potentially weaker-than-expected performance in the third quarter.