SHANGHAI Chinas daily crude steel output and major mills inventory continued to rise in mid-September, adding more supply pressure to the market.
The country produced 2.144 million tonnes per day of crude steel in the second 10 days of September, up from 2.129 million tonnes daily in the preceding 10 days, according to estimates released Sept. 26 by the China Iron and Steel Association (Cisa).
Output by Cisas member mills, which are mainly medium to large-sized steelmakers, averaged 1.7795 million tonnes per day vs. 1.7625 million tonnes daily in the same comparison.
As of Sept. 20, combined steel inventory at Cisas member mills reached 13.22 million tonnes, up 625,700 tonnes (5 percent) from Sept. 10 levels.
"This is not a good sign," a Shanghai-based analyst told AMM sister publication Steel First. "Production up again but demand seems (to show) no improvement, which could weigh on prices in October."
Domestic steel prices have already dropped following continuous production increases since late August, with hot-rolled coil at 3,500 to 3,520 yuan ($569 to $573) per tonne in Shanghai Sept. 26, down 110 yuan ($18) per tonne from Aug. 30.
A version of this article was first published in AMM sister publication Steel First.