China's steel production rebounded in October after four months of consecutive declines, driven by improving margins and measures to stimulate economic growth. Steelmakers produced 81.88 million tons during the month, representing a 6.2% increase from September and a 2.9% rise compared to October last year, according to data released by the National Bureau of Statistics.
This increase has reduced the year-to-date production decline to 3% compared to 2023, suggesting the sector could surpass 1 billion tons of output for the fifth consecutive year if current production levels are maintained. Analysts attribute the recovery to rising export volumes and increased orders from the manufacturing sector and state-supported construction activities, despite ongoing challenges.
Many steel mills, however, continue to operate under financial strain due to weak demand from the property sector, a traditional driver of steel consumption. Industry experts remain cautious, emphasizing that the rebound may not signal a sustained recovery. Last month, the China Iron and Steel Association called for production discipline among steelmakers, warning that market fundamentals have not significantly improved despite a recent rise in prices.
While the government has indicated room for additional stimulus next year, such measures are unlikely to revive the conventional demand sources of large-scale infrastructure projects and new housing developments, leaving uncertainty about the sector’s long-term trajectory.
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