Supply of crude steel from China increased 10% from a year earlier in July to the biggest ever monthly figure, Bloomberg reports, citing the country’s statistics bureau.
“Steel mills are making record profit margins, so any steel plant that’s not required to stop or cut production really has no reason to hold back,” Kevin Bai, analyst at consultancy CRU Group, was quoted as saying. “Mills are still very bullish on the second half, but we see a possible price dip as we expect demand to be a bit more subdued, especially in sectors like auto or machinery. Profitability is unreasonably high and that can’t be sustained.”
The sharp increase in productions comes as the Trump administration continues an internal review of reports on potential restrictions on steel imports. The White House has repeatedly accused China of steel and aluminum dumping.