China's daily June crude steel output hits record

Wed Jul 13, 2011

* Construction boom drives daily June steel output to peak
* Analysts expect steel output to stay near record levels in July

SHANGHAI, July 13 (Reuters) - China's daily crude steel output hit a record 1.998 million tonnes in June, up 2.8 percent from May, data from the National Bureau of Statistics showed on Wednesday.

June output was 59.93 million tonnes, 11.9 percent higher from the same period last year.

China's steel mills, particularly, small- and medium-sized ones producing long products for use in construction, have raced to raise output amid strong demand from the sector, defying the traditional pattern of weakness during the summer and government policy tightening measures to cool asset prices and inflation.

"The construction of social housing units has accelerated in June, fuelling strong production of long steel products," said Hu Zhengwu, researcher with industry consultancy Custeel.com.

Analysts expect China's daily crude steel output to cling to near record high levels in July as the pace of building 10 million affordable housing units accelerates and fans demand for steel products.

A survey by Custeel of 37 long products producers showed that their rebar output will rise 34,300 tonnes to 5.755 million tonnes, while wire rod output will surge 282,000 tonnes to 3.26 million tonnes in July from June.

China produced 78.73 million tonnes of steel products in June, up 14.8 percent from a year earlier.

Iron ore output in the world's largest steel producer also hit a record 124 million tonnes in June, up 21 percent from May and 27.3 percent higher from a year earlier.