Worldsteel figures show China ramping up furnaces again

Global steel production in May for the 71 countries reporting to the Brussels-based World Steel Association (Worldsteel) reached 165.1 million metric tons (MMT), representing a 1.5 percent increase compared with May of last year.

Because China makes more than half the world’s steel, when its furnaces increase production—as they did this May—it can change the momentum of global output.

In China, the 92.9 MMT of steel made in May was 2.7 percent greater than what was produced a year ago, reversing a trend from the earlier months of this year. Perhaps just as noteworthy, the 92.9 MMT figure represents an 8.1 percent jump compared with the 85.9 MMT made in China this April.

The uptick in steel activity last month could have been in anticipation of an improvement in China’s construction sector in response to announced government incentives.

However, more recent reports from the financial and metals industry press are indicating a drop in Chinese steel prices and disappointing demand for rebar and other grades in June, as problems in China’s overbuilt apartment tower sector seem far from solved.

Other nations with improved year-on-year steel output this May include Turkey (11.6 percent higher) and India (3.5 percent higher), according to Worldsteel.

Although India and Turkey made a combined 15.4 MMT of steel this May, any demand for ferrous scrap from producers there was not enough to lift ferrous scrap prices in the United States.

In the U.S. itself, steelmakers produced 1.5 percent less steel this May compared with May of last year.

Year to date, the U.S. is off last year’s pace by 2.4 percent. Other potential U.S. scrap export markets with reduced steel output so far in 2024 include: South America (down 1.4 percent); Japan (down 2.3 percent); and South Korea (down 6.3 percent).

Mills in Turkey and India are outpacing last year’s steel production, with Turkish mill output up by 19.9 percent in the first five months of this year and Indian output up by 7.7 percent.