CISA: China peak steel is in (and how)

From Bloomie, China’s:

…apparent crude steel demand fell 6 percent in the first quarter, CISA said in a report posted on its website Wednesday. Faltering consumption at home will sustain exports as producers seek profits overseas. China’s exports of steel products in the first quarter rose 41 percent from the same period last year to 25.8 million tons, customs data shows.

…Property development is falling for a second year, automobile production growth has slowed, shipbuilding activity dropped and home appliance output — except for washing machines — slid in the first quarter, according to CISA.

Minus 6% for Chinese steel consumption, crikey, and we’ve barely begun the adjustment.

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Comments

  1. Combine this with the Iron Ore Hedge (AKA steel picket fence) and we are looking at some epic down turns.

    BRING IT !

    Budget – come on you good thing. This is gong to be soooooooooooooo awesome.

    I am forecasting right now the most insipid, do nothing, fence sitting, middle of the road, apathetic budget of all time – tinged with a screw you weak, poor, sick, defenceless, young, left, science, progressive, thinking people.

    .

    • I suspect it will be a non event Budget – too much whinging over the last one dampened appetite for embracing the challenge and anyway, the Oz public, especially the ones that want a fair share (of others earnings) are noisy cogs that demand constant oiling.

      • 3d,
        reading what you write makes me gag! It’s all in Glenn’s last sentence and you know it and as usual you ignore it.

        People weren’t whinging, but expressing their disgust at the gov targeting the less well off while allowing all the tax rorts to remain and the likes of Google etc to move their taxable income offshore.

        Talking of noisy cogs, the noisiest is corporate welfare, but you know that.

        Watching the IO sector hit a brick wall brings a smile to my face, as I think of you.

  2. “Big Chinese integrated coastal mills are among the most competitive in the world as they have benefited the most from sharp falls in imported iron ore prices, helping them to gain growing market share both at home and abroad,” said Zhao Chaoyue, an analyst with Merchant Futures in Guangzhou.

    Seaborne iron ore prices tumbled 50 percent over the course of the year amid a push by mega iron ore miners to ramp up supply and win market share.

    BIG MILLS BENEFIT

    Big Chinese mills are able to ship in cheaper seaborne ore direct to their coastal steelmaking operations, selling to customers nearby or shipping steel overseas.

    The iron ore price fall also encouraged large mills – those with an annual output of more than 10 million tonnes – to buy more from the spot market, winning benefits once garnered mainly by more flexible private mills.

    Despite the scrapping of tax rebates for exports containing boron that had helped boost sales, Chinese exports rose 41 percent in the first quarter, increasing concerns from rival producers around the world.”

    • China now produces more than half of all global steel. These big mills are major operations, specifically located near ports to take advantage of seaborne IO, thus far April production has increased yoy. Despite concerns from steel makers elsewhere, China intends to continue to dominate the global steel market.

      • so no chinese domestic demand then hey, are Rio praying the world will accept china dumping crap steel on them in perpetuity

      • Of course there’s still Chinese demand. There is still much infrastructure development and steel production for use other than construction. As AIIB and Silk Road initiatives roll out there will be even more demand. That said, no one is looking at demand growth % of recent years.