The world’s crude steel production was 164Mt in April 2024, down 5% y-o-y, mostly driven by a 7% y-o-y decline in China.

The decline in China is mainly attributed to weak domestic demand, mitigated to some extent by strong exports. Overall, a subdued macro environment should translate into a rangebound 2024 steel production. Meanwhile production was also lower in North America (-5.2%), the CIS (-3.5%), Latin America (-3.9%) and the Middle East (-8.2%). The EU managed to post a 1.1% y-o-y production increase at 11.2Mt.  

For the January-April period, total production was 631Mt, a smaller -0.9% decline. China (-3% y-o-y), the EU (-0.6%), the US (-2.2%) and Japan (-1.2%) posted negative growth, while production rose the most in India (+8.5%), Vietnam (+19.8%) and Turkey (+22.1%). China's pig iron production posted a -4.3% y-o-y decline, indicating that some blast furnaces have been idled in Q1 for maintenance.  

China's lower steel production is the reflection of a weak construction and property sector. The Chinese government keeps taking steps to stabilise the market, the latest being lowering down payment minimums to 15%, vs 20% previously, in addition to cancelling the floor on mortgage rates nationwide. China’s Central Bank will also provide RMB300Bn (US$42.25Bn) for local state-owned enterprises (SOEs) to buy unsold apartments that have already been built. But despite an accommodative monetary policy, confidence of would-be buyers remains low and property developers remain cash strapped.  

The weak domestic demand has been partly mitigated by strong steel exports, which increased by 27% y-o-y to 35Mt. Main export markets were Southeast Asia (11Mt), Middle East and Africa (10.4Mt), East Asia (4.6Mt), Central and Latin America (3.6Mt). Exports to Europe were only 1.5Mt and to North America less than 1Mt. Project Blue forecasts a slightly higher Chinese steel production in 2024, with strong exports more than offsetting the weak domestic demand.  

Steel production in the EU appears also flat, a reflection of weak macroeconomics and consumer demand. With a first cut in interest rate expected at the ECB’s June meeting, some recovery could take place in the second part of the year, although probably limited in magnitude. With a slowing US economy, the most likely scenario is a flat to slightly lower steel production in North America. India’s strong production growth should continue in 2024, driven by an 8% GDP growth and an insulated economy. Overall, Project Blue forecasts a 1% global steel output increase in 2024.