China february crude steel average daily output hit record

China february crude steel average daily output hit record. China's crude steel output in first two months of the year set new records, with daily average volumes in February and the monthly total in January both reflecting an unprecedented pace of production. China's crude steel is a closely watched barometer of the state of the country's economic health, but the industry's inability to calibrate its output has often meant overshooting demand levels, leading to steel price gyrations. China's daily average production of crude steel last month rose to a record 1.94 million tons from 1.93 million tons in January, calculations based on data from the National Bureau of Statistics showed Friday. Crude steel output in January was 59.87 million tons, also a new record. The bureau didn't provide January output data last month because the Lunar New Year break interrupted its data release schedule. "The effect of the Lunar New Year on crude steel production was very small, as steel mills basically kept on going 24 hours a day throughout the period," said Judy Zhu, a steel analyst with Standard Chartered. February output rose 9.7% from a year earlier to 54.31 million metric tons. In the first two months this year, the country produced 114.18 million tons of crude steel, up 13% on year, it said. Buoyed by a strong wave of demand from construction, automotive and appliance manufacturing, Chinese steelmakers have been chasing higher prices for months, taking Shanghai steel futures prices up 10% between October and February. Nevertheless, steel inventories have risen to a record 19 million tons in major cities surveyed by Standard Chartered. "The increases are particularly obvious in construction materials, up 63% from end-October, reasserting our view that the construction sector will be a drag for steel consumption growth this year," Zhu said. Steel prices have begun slipping again, down 5% Friday to CNY4,682/ton compared with the end of last month. Mirae Asset correctly predicted the production binge would lead to a domestic steel price correction earlier this month. "Private steel mills, motivated by improved margins, are running at full production capacity," Henry Liu, Mirae's regional head of commodities research, said. "Steel mills are recklessly boosting their ex-factory prices, which further squeezes the margins of steel traders." "The party will come to an end when traders find it difficult to finance their inventories," he said. China's output of materials associated with the steel industry also rose in the first two months. The country produced 72.45 million tons of iron ore last month, up 22%. In the first two months, iron ore output reached 146.24 million tons, up 21% Pig iron production in February reached 50.51 million tons, up 10% on year. In the first two months, output of pig iron was 102.68 million tons, up 8.9% compared with the same period last year.