China’s biggest steel industry group has urged its members to cut output by 5 percent in the last three months of this year as it seeks to better balance supply and demand, hoping to stem falling prices.
China’s biggest steelmakers agreed at a national meeting held in Beijing last Friday to set up a committee to discuss ways to counter the drop in prices, the China Iron and Steel Association said in a notice seen Tuesday on its Web site.
Meanwhile, MEPS warned today:
MEPS (International) Ltd expects crude steel output in 2005 to be just below 1116 million tonnes – 6.2 percent up on the year earlier figure. Blastfurnace iron production is forecast to expand by almost 8 percent and direct reduced iron supply by 2.7 percent, year on year.
The steel manufacturers of most industrialised countries and the emerging nations have acted very responsibly in reducing output to balance market demand, during the second and third quarters of the year. This is expected to extend into the final trimester. Our forecasts from the previous issue of World Steel Outlook have been trimmed.
China still leads the way; with an anticipated increase of 77 million tonnes. This will be more than the 65.5 million tonne rise we attribute to the total world output. Producers in the EU and US are expected to reduce supply by above 16 million tonnes in 2005.
Chinese steel consumption has been growing rapidly for most of this year. However, steel output has been moving up at a faster rate – transforming the country from a net importing nation into a net exporter of steel. India will also increase output this year by around 16.5percent – not all of which will be consumed in their home markets.