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Chinese steelmakers churned out a highest-ever 72.78 million
tonnes in April, up 4.9 percent, the National Statistics Bureau
(NBS) data showed on Monday, surpassing March's monthly record
of 72 million tonnes as mills in the world's top producer rushed
to profit from rising prices even as demand remains flat.
In a briefing after the data release, an NBS spokesman said the
nation had already met 63.4 percent of this year's targeted cuts
for steel and 46 percent of coal cuts.
The ramp-up in steel output underscores the challenge for the
government as it aims to slash 50 million tonnes of low-grade
outdated capacity this year, on top of the 65 million removed
last year. The government is targeting rebar, used in
construction, in particular.
But many of the plants that have been closed in recent years
were already idled and output from still-open plants has
continued to rise.
"Driven by high profits, steel companies are raising their
capacity, by using high-quality iron ore and increasing their
use of steel scrap," said Bai Jing, analyst at Galaxy Futures.
"Production might be at record high, but the steel production
capacity is being reduced."
In the first four months, production totaled 273.9 million
tonnes, up 4.6 percent from the same period a year earlier, the
data showed.
(Reporting by Josephine Mason; Additional reporting by Hallie Gu;
Editing by Richard Pullin and Tom Hogue)
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