Global crude steel production shrank in April on lower output across all major producing countries barring India – according to the latest monthly report from the World Steel Association (“WSA”). The steel industry continues to reel under sluggishness in China – the world’s largest steel consumer.
The international trade body for the iron and steel industry said that crude steel production for 65 reporting nations fell 1.7% year over year to 135.4 million tons (Mt) in April. This follows a 2.7% decline in Mar 2015 that also saw lower output across all major producers except India.
The April reading for Asia showed lower output in China, Japan and South Korea that more than offset a rise in India, leading to a 1.2% contraction in overall output for the region to 92.5 Mt.
Steel production in China – the world's biggest steel maker – slipped 0.7% year over year to 68.9 Mt in the reported month after falling 1.2% in March. A slump in the housing market, persisting credit crunch and weak infrastructure investment continue to weigh on steel demand in the world’s second-largest economy.
The sluggishness in China’s economy is further evident from contraction in its manufacturing sector in May. The HSBC Purchasing Managers' Index (PMI) showed a preliminary reading of 49.1 for the month, indicating subdued domestic and overseas demand. A reading less than 50 indicates contraction in manufacturing activity.
Output also fell 6.1% to 8.4 Mt in Japan – the second-largest producer. India, which is now the third-biggest steel maker, produced 7.4 Mt. of crude steel for the month, a 2.1% gain. Production in South Korea tumbled 6.6% to 5.8 Mt.