Total crude steel production rose 0.5% y-o-y to 161.4Mt in June but was flat in H1 at 954.6Mt. 

China steel output rose 0.2% y-o-y in June to 91.6Mt but showed a 1.1% y-o-y decline in H1 to 530.6Mt. Construction activity remains weak and property prices keep falling, pulling consumers’ confidence further down, as evidenced by the -11.7% y-o-y drop in rebar production in H1 to 102.3Mt. A low domestic demand has been offset by strong exports, which increased 22% y-o-y in H1 to 53.3Mt, with the main markets being Southeast Asia, the Middle East and Africa as well as East Asia. Chinese steel exports have also been rising to Central and Latin America, increasing 24% y-o-y, a trend likely to be slowed by imports tariffs increases implemented in Mexico, Brazil and Chile. Chinese steel exports to Europe and the US dropped by 5% and 8%, respectively at 2.1Mt and 1.4Mt.

The EU steel production increased 5.1% in June and 0.9% in H1, driven by a higher output in Germany and in France with respective H1 y-o-y increases of 4.5% and 6.1%, offset by a -5.2% decline in Italy. The EU economy has showed a fragile recovery in the first half of 2024, a trend which may continue at a very moderate pace in H2 with additional interest rates cuts expected from the ECB.

North America crude steel production dropped -1.9% in June and -3.3% in H1, driven by a declining US output of -1.5% and 2.4%. Latin America steel production was -1% lower in H1, mostly because of a sharp -25.2% drop in Argentina’s output. 

The Middle East continued to perform strongly in H1 with a 5.8% y-o-y increase along with Turkey which posted a 16.9% y-o-y rise. Steel output recovered in Ukraine from a low base with a 37% y-o-y increase while dropping -3% in Russia.

Steel production kept increasing in India at 6% y-o-y in June and 7.4% in H1, in line with a strong and relatively insulated domestic economy. Japan and Korea posted respective lower outputs of -2.6% and -6.4%. The Japanese steel production has been impacted by a weak domestic demand, combined with rising costs, while steel exports have been hurt, despite a weaker Yen, by an increasing Chinese competition. In Korea, the lower steel production was due to a weak domestic demand combined with furnaces maintenance shutdowns at POSCO and Hyundai Steel.

Overall, Project Blue forecasts a flat global production in H2, depending on the macroeconomic environment in Europe and in the US and whether China can keep offsetting its weak domestic demand with high exports. India and the Middle East will most likely continue to outperform.