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China Nov crude steel output down 3.2% on month as anti-pollution curbs remain

China’s crude steel output fell for the sixth consecutive month in November, slipping 3.2% from October, official data showed on Wednesday, as production restrictions to combat pollution continued and construction demand remained stagnant.

The world’s top steel producer made 69.31 million tonnes of the industrial metal last month, compared with October’s output of 71.58 million tonnes. That was down 22% from the same month a year earlier, according to the National Bureau of Statistics (NBS).

Average daily crude steel output in November stood at 2.31 million tonnes, recovering fractionally from average output of 2.309 million tonnes in October, according to Reuters calculations based on the NBS data.

China had capped steel output in the first 10 months of 2020 at a level lower than a year earlier in a bid to reduce pollution. Production, especially in northern areas, has been curbed as Beijing works to improve air quality during the winter heating season and ahead of the Winter Olympics.

Capacity utilisation rates of blast furnaces at 247 steel plants across the country had been running around 76% in November, well below an average of 92% in November 2020, according to Mysteel consultancy.

“Steel production controls had been marginally relaxed in October, the downward trend for downstream demand squeezed profits and in turn steel firms continued to cut output,” CITIC Futures analysts wrote in a note before the data was released.

The analysts expect China’s overall molten iron output to fall around 25 million tonnes this year from 2020.

In the first 11 months of the year, China made 946.36 million tonnes of steel, down 2.6% from the same period a year earlier, the NBS data showed.
Source: Reuters (Reporting by Min Zhang and Dominique Patton; Editing by Shri Navaratnam and Kenneth Maxwell)

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