China increases steel production again

Steel production in China rose 1.8 percent in May 2017 from a year earlier. Data from the country's bureau of statistics showed that the factories of the world's largest manufacturer are maintaining robust profitability despite government efforts to curb overcapacity.

The total volume of steel production in May was 72.26 million tons, which is slightly lower than the April 72.78 million tons. Boosting steel output and strong margins have been fueled by a tightening of supplies of steel construction products appointed after Beijing pledged to tackle poor quality furnaces by the end of this month.

The world's largest steel producer and consumer cut 65 million tonnes of steel capacity in 2016 and aims to cut another 50 million tonnes of obsolete capacity this year, not counting low-quality steel. “If we break down the monthly output by day, we can see that production gradually slows down as demand weakens,” said Bai Jing, an analyst at Galaxy Futures.

In the first four months, China's steel output was 346.8 million tons, up 4.4 percent from the same period a year earlier, the latest data showed.