• China reported official crude steel production for June of 91.61 Mt, marking a slight increase of 0.20% y/y. This compares with an implied drop of 2.06% y/y in output at China Iron and Steel Association (CISA) member mills over the same period and indicates it may be these larger mills that are at the forefront of curbs on output. Production is also on track to contract in July with output over 1-10 July at CISA member mills, of 2.15 Mt/day, easing lower from the late June total and also sharply lower than the 2.24 Mt/day reported in the same period last year.

• Decelerating steel exports are expected to put more downward pressure on crude steel production. Customs data show that although China’s steel exports increased by 1.24 Mt y/y to 8.75 Mt, they are down from the 9.63 Mt reported in May. This easing in shipments may reflect a m/m fall in steel output, but also a recent crackdown on tax-evading illegal exports and a ramping up of tariffs targeting Chinese products in other countries.
• The latest operational results by major iron ore miners again proved Kpler Insight’s success in predicting the production or shipments of major iron ore miners. Rio Tinto just reported 80.30 Mt shipments (100% basis) for the past 2q24, compared to our projection of 79.80 Mt at the beginning of July. BHP officially disclosed production of 76.80 Mt (WAIO 100% basis) for the June quarter, only slightly higher than the 76.10 Mt we had forecasted. Vale achieved 80.60 Mt of iron ore production, higher than the expected 78 Mt. This discrepancy may reflect a rebuilding of inventories in Brazil after exceptionally strong shipments in the 1q24.

China’s steel exports decelerated in June (Mt)

Source: China Customs

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