More and more factories are completing annual overhauls of blast furnaces

Blast furnace capacity utilization among China’s 247 steelmakers rose for the third week in a row on January 19-25, according to Mysteel data.

It reached 83.5% during the period, gaining another 0.52 percentage points over the week as Chinese steelmakers continued to resume production after maintenance outages.

During January 19-25, daily pig iron production at 247 enterprises increased by 0.6% week-on-week – to 2.23 million tons per day.

According to a Shanghai-based analyst, there has been an upward trend in domestic pig iron production in recent weeks. More and more plants are completing annual overhauls of blast furnaces and resuming operations.

Accordingly, the demand of steelmakers for iron ore is constantly growing. The daily consumption of imported raw materials among 247 steel producers averaged 2.72 million tons on January 19-25, also growing for the third consecutive week (+0.7% weekly). China’s steelmakers continued to purchase iron ore at a steady pace to build up adequate stocks for the Chinese New Year holidays.

As GMK Center reported earlier, most Chinese steel mills are likely to maintain high production rates during the Lunar New Year period, which will lead to steady demand for iron ore. Some market participants note that steel mills in North China maintain a 7-14-day supply of raw materials, but may continue to replenish it from ports.