China’s crude steel output for 2015 is likely to stand at around 806Mt (metric tonnes), down 2% year-on-year, according to Chinese media reports. This is being reported in China as the first negative growth since 1981.

The news is being seen in China as positive as China’s domestic steel industry has been directed to accelerate ‘de-capacity’.

During the first 11 months of 2015 China yielded 739Mt of crude steel, down 2.2% year-on-year.

A survey my Mysteel towards the end of December last year points to the operating rate of the blast furnaces being 74.03%, down 1.11% week-on-week and the capacity utilisation rate being 80.02%, down 0.58% week-on-week.

According to Mysteel, China's crude steel output will drop further in January 2016. The company estimates that daily average crude steel output between 1-10 January will 1.9Mt (metric tonnes) down 0.36% from the period 21-31 December 2015.

While prices rebounded towards the end of 2015, steel mills didn't increase production.

The Chinese Academy of Sciences estimates that the climate for Chinese steel will remain low throughout 2016. It is thought that crude steel output this year will be around 786Mt, down 3.1% year-on-year.

Source: China Metals.