* Jan, Feb total output hits 114.18 mln tonnes
* Strong production attributed to small mills
BEIJING, March 11 (Reuters) - China's daily crude steel output rose 0.5 percent from January to a record high of 1.94 million tonnes in the holiday-shortened month of February, with private mills producing with abandon despite demand uncertainty.
China produced a total of 54.31 million tonnes of crude steel in February, up 9.7 percent from the same month last year, according to official data from China's National Bureau of Statistics on Friday.
Many Chinese businesses were shut for a week in February to mark the Lunar New Year holiday. According to Reuters calculations, average daily output in the first two months of 2011 was 16.6 percent higher than in December, when hundreds of small mills were forced to shut down to comply with a state energy saving campaign. "The ramp-up happened pre-Chinese new year and continued until late in the month when prices began to fall," said John Guise, China editor with Steel Business Briefing. "If you look at everybody's attitude and at steel prices just before the Chinese new year holiday, everybody was thinking it's going to get better and it was hard to find a dissenting opinion in the crowd."
Prices on the domestic market have been on the decline after hitting a peak in early February, with the industry blaming long-standing overcapacity problems as well as uncertainties about demand. While the industry is concerned about its prospects in 2011, producers are unlikely to cut output as long as they are still making profits -- however meagre. "You are not seeing large mills making production cuts -- we've heard billet producers who service smaller mills starting to make production cuts but the major steel makers are not and probably will not do so until they stop making a profit," said Guise. Traders are waiting to see whether or not industry leader Baoshan Iron and Steel will reduce its prices for April delivery, with an announcement due soon. The statistics bureau said China produced 63.54 million tonnes of steel products in February, down from 97.84 million tonnes in December. Iron ore output in February reached 72.45 million tonnes, down from 73.79 million tonnes in January and 98.21 million tonnes in December. (Reporting by David Stanway and Ruby Lian, Editing by Tom Miles and Ed Lane, sourced:Thomson Reuters)
* Strong production attributed to small mills
BEIJING, March 11 (Reuters) - China's daily crude steel output rose 0.5 percent from January to a record high of 1.94 million tonnes in the holiday-shortened month of February, with private mills producing with abandon despite demand uncertainty.
China produced a total of 54.31 million tonnes of crude steel in February, up 9.7 percent from the same month last year, according to official data from China's National Bureau of Statistics on Friday.
Many Chinese businesses were shut for a week in February to mark the Lunar New Year holiday. According to Reuters calculations, average daily output in the first two months of 2011 was 16.6 percent higher than in December, when hundreds of small mills were forced to shut down to comply with a state energy saving campaign. "The ramp-up happened pre-Chinese new year and continued until late in the month when prices began to fall," said John Guise, China editor with Steel Business Briefing. "If you look at everybody's attitude and at steel prices just before the Chinese new year holiday, everybody was thinking it's going to get better and it was hard to find a dissenting opinion in the crowd."
Prices on the domestic market have been on the decline after hitting a peak in early February, with the industry blaming long-standing overcapacity problems as well as uncertainties about demand. While the industry is concerned about its prospects in 2011, producers are unlikely to cut output as long as they are still making profits -- however meagre. "You are not seeing large mills making production cuts -- we've heard billet producers who service smaller mills starting to make production cuts but the major steel makers are not and probably will not do so until they stop making a profit," said Guise. Traders are waiting to see whether or not industry leader Baoshan Iron and Steel will reduce its prices for April delivery, with an announcement due soon. The statistics bureau said China produced 63.54 million tonnes of steel products in February, down from 97.84 million tonnes in December. Iron ore output in February reached 72.45 million tonnes, down from 73.79 million tonnes in January and 98.21 million tonnes in December. (Reporting by David Stanway and Ruby Lian, Editing by Tom Miles and Ed Lane, sourced:Thomson Reuters)
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