INDIA PIPS JAPAN IN STEEL OUTPUT

NEW DELHI: India outstripped Asian industrial giant Japan to become the second largest steel producer in February as its crude steel output grew by 3.43 per cent to 8.434 million tonnes (MT) in the month against 8.296 MT of the latter, according to global steel body Worldsteel data.

India had almost caught up the Asian giant in January by producing 9.02 MT crude steel compared and 9.03 MT by Japan.

However, Japan retreated to the third spot in February due to a 0.5 per cent fall in steel production compared to 8.340 MT in the year-ago month, Worldsteel data showed.

On year-on-year basis, India registered a growth 3.43 per cent in February as compared to 8.154 MT in February 2017, World Steel Association said in its latest report.

World leader China saw a rise of 5.9 per cent in crude steel production in February this year at 64.930 MT. It had produced 61.328 MT during the same month last year. South Korea's output fell by 2.1 per cent yearon-year to 5.4-million tonnes.

The US produced 6.4 Mt of crude steel in February 2018, a 0.4% increase on February 2017.

Global crude steel production of the 64 countries reporting to the World Steel Association was 131.791 MT in February 2018, a growth of 3.5 per cent year-on-year.

"The crude steel capacity utilisation ratio of the 64 countries in February 2018 was 73.3 per cent. This is 1.8 percentage points higher than February 2017. Compared to January 2018, it is 0.5 percentage points higher," the report said.

Meanwhile, Africa's crude steel production increased by 4 per cent year-on-year to 1.1-million tonnes, mainly as a result of a 7.6 per cent year-on-year increase in Egypt's crude steel output to 583 000 tonnes. South Africa's production decreased by 0.9 per cent year-on-year to 491 000 tonnes. Libya's output increased by 15 per cent yearon-year to 48 000 tonnes.

The data will likely draw international scrutiny after U.S. President Donald Trump this month slapped hefty import duties on steel, aimed at dissuading China from exporting its excess metal at what he says are state subsidised prices.

Trump also aims to impose tariffs on up to $60 billion of imports from China, and Beijing has said it would take strong retaliatory measures to protect its rights.

Chinese rebar prices hit a near nine month low on Monday on worries over slowing demand from the construction sector, growing inventories and the potential trade war between the world's two largest economies.

“China are over-producing relative to the curent level of demand. It was always a downside risk that China would start to slow. Financial institutions have cautioned things can't go on forever,” said Jeremy Platt, analyst at steel consultancy MEPS.

“We're expecting prices to fall in the second half because of China, but equally we're not anticipating a crash.”

“The rebound in U.S. production was not too surprising given the prospect of a 25 percent tariff on U.S. steel imports and the recent stratospheric rise in prices. We expect production to pick up further over the coming months as higher prices encourage capacity restarts,” said Capital Economics in a note.

The steel industry, worth about $900 billion a year, is a seen as a gauge of the world's economic health.