China's June crude steel output up 9pct on year

China's crude steel output rose 9 per cent to 53.77 million tonnes in June from a year earlier, but fell 4.2 per cent on the month after hitting an all-time high in May, the National Bureau of Statistics said on Thursday.

Year-on-year growth fell sharply from previous levels above 20 per cent since December last year, while daily output dropped slightly to 1.79 million tonnes, after having stood above 1.8 million tonnes in April and May, data showed.

Small Chinese steel mills have curbed production in June in response to falling prices and weakening demand, and big steel mills have not taken the lead in cutting output as usual.

"The big mills are very unlikely to cut production to a significant degree. They won't be pushing it out as hard as they were perhaps in April, so in that sense, production might be lower, but it's really not a cut," said Graeme Train, an analyst with Macquarie Commodities Research.

Analysts expect China to produce less crude steel in the summer season, but they predict that big steel mills will not slash production.

"Output didn't fall largely in terms of daily level, showing that production cutbacks are still limited, and I expect output will drop again in July and August, but not by a big extent," said Hu Yanping, an analyst from Umetal.com.

Total crude steel output for the first half of this year rose by 21.1 per cent to 323 million tonnes, data showed.

Steel products output rose 15.9 per cent from a year earlier to 71.4 million tonnes, taking the combined output for the first six months of this year to 398.7 million tonnes.

Output of iron ore, a key ingredient in the production of steel, reached 101.6 million tonnes, up 21.4 percent from the same period last year and 11.5 per cent from May, the data said.