China’s 2021 crude steel output down 3% from record high due to strict production restrictions

By Min Zhang and Dominique Patton

BEIJING (Reuters) – China’s annual crude steel output falls for the first time in six years in 2021, retreating from a record level in 2020 as the country steps up curbs emissions in its huge iron sector.

Data from the National Bureau of Statistics (NBS) showed on Monday that the world’s largest steel producer produced 1.03 billion tonnes of crude steel last year, down 3% from output of 1.065 billion tonnes. in 2020.

Since the beginning of 2021, Beijing has urged the industry to maintain full-year steel output at no more than the previous year’s levels to reduce pollutants and greenhouse gas emissions, as the country has pledged to achieve carbon peak by 2030.

The target is said to be “hard to achieve” as strong downstream demand from the construction and manufacturing sectors has boosted mill profits and brought China’s steel output in six months. At the beginning of the year, it was nearly 12% higher than the same period in 2020.

However, steel output has begun to contract annually and monthly since July as the government tightened environmental controls. Unexpected power shortages – boosting raw material prices – and a debt crunch in the real estate market also dampened demand for industrial metals.

In the second half of 2021, China produced 470.86 million tons of crude steel, down 16% from July-December of the previous year.

The Bureau of Statistics said steel output in the last month of the year stood at 86.19 million tons, up from 69.31 million tons in November but still 6.8% lower than December 2020.

December’s average daily output stood at 2.78 million tonnes, up more than 20 percent from a month earlier, according to Reuters calculations based on NBS data.

Going forward, analysts expect the upcoming Lunar New Year and the Beijing Winter Olympics to continue to weigh on manufacturing, before consumption gradually picks up after the holiday season.

A government consulting firm predicts that China’s steel demand will decline slightly this year and crude steel output will fall by about 0.7% from 2021.

(Reporting by Min Zhang and Dominique Patton; Editing by Kenneth Maxwell)

https://whbl.com/2022/01/16/china-2021-crude-steel-output-retreats-3-from-record-high-on-stringent-production-curbs/ China’s 2021 crude steel output down 3% from record high due to strict production restrictions

James Brien

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