* China steel output hit 72.26 mln T in May
* That is just below April's monthly record
* Mills buoyed by robust margins
(Adds comment, background)
BEIJING, June 14 China's steel output rose 1.8
percent in May from a year earlier, data from the country's
statistics bureau showed on Wednesday, with mills in the world's
top producer buoyed by robust margins despite government efforts
to curb excess capacity.
May's total of 72.26 million tonnes was just below April's
monthly record of 72.78 million tonnes.
The ramp-up in steel output has been spurred by high margins
due to tighter supplies of construction steel after Beijing
vowed to crack down on low-quality furnaces by the end of this
"If we break down the monthly output into daily, we can see
the production is gradually slowing down as demand is
weakening," said Bai Jing, steel analyst at Galaxy Futures.
"But the margin of over 1,000 yuan ($147.11) a tonne on
rebar is still high enough to entice mills to produce more,"
The world's largest steel producer and consumer cut some 65
million tonnes of steel capacity in 2016 and aims to cut another
50 million tonnes of outdated capacity this year, not including
The most-traded rebar futures gained more than a
quarter this year, peaking at 3,377 yuan a tonne in March, but
dropped back to 2,930 yuan a tonne on Wednesday.
In the first four months, production totaled 346.8 million
tonnes, up 4.4 percent from the same period a year earlier,
Wednesday's data showed.
($1 = 6.7975 Chinese yuan renminbi)
(Reporting by Muyu Xu and Beijing Newsroom; Editing by Richard
Pullin and Joseph Radford)