China's steel exports are lower than expected

According to sources, if not affected by the COVID-19 epidemic, with orders placed from the end of February and March, steel exports in April could reach at least 6-7 million tons.
S&P Global site recently cited China Customs data, the country's finished steel exports increased by 0.7% to nearly 5 million tons in April, lower than market expectations due to the COVID-19 epidemic. affecting the logistics situation at major ports.

Industry experts said that exports in May are unlikely to improve due to the prolonged delay in delivery.

Despite a slight increase from March, April's steel exports were still 37.6% lower than the same period last year. In the first four months of 2022, China shipped 18 million tons of finished steel, 29.2% lower than the same period last year.

Many Chinese steel mills had to cut output because of the new COVID-19 outbreak. Tangshan City began a temporary blockade on March 22 to control the spread of the COVID-19 pandemic. The leader of a steel company said the new restrictions have prevented steel mills from replenishing raw material inventories.

According to sources, if not affected by the COVID-19 epidemic, with orders placed from the end of February and March, steel exports in April could reach at least 6-7 million tons.

Operations at major ports in northern China, such as Tangshan and Tianjin, and ports in eastern China such as Shanghai and Zhangjiagang, have faced disruption since April due to restrictions. caused by the pandemic.

"As of the end of April, the number of COVID-19 infections in Zhangjiagang city was almost zero, but ports are still subject to some restrictions, causing delays in shipments," a source added.

In addition to the delayed export shipments in April and May, many are concerned about export orders that have been shrinking since April.

One source said overseas demand for steel has slowed, and logistics disruptions could reduce its appeal.

In April, China's finished steel imports reached the lowest level since August 2019 at 956,000 tons, down 5.4% from March and 18.6% year-on-year. This is partly due to weak domestic demand while disruptions at ports also affect imports.

China's total steel imports in the first four months of the year reached nearly 4.2 million tons, down 14.7% year-on-year, according to customs data.

As a result, the net exports of finished steel in April reached 4 million tons, up 2.2% compared to March although still 41% lower than the same period last year. Data shows that net steel exports in the first four months of the year fell 32.6% year-on-year to 14 million tons.

Vietnambiz