China's finished steel exports rose 0.7% on the month to 4.977 million mt in April, China customs data showed May 9, falling short of market expectations as the COVID-19 resurgence hits logistics at major ports.
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Exports in May are unlikely to improve significantly as shipment delays have continued this month, sources said.
Despite slightly rising from March, April exports were still 37.6% lower on the year. In the first four months of 2022, China shipped 18.156 million mt of finished steel, 29.2% lower on the year.
Given strong overseas orders received in late-February and March, April's finished steel exports could have reached at least 6 million-7 million mt, but port logjams due to the outbreaks chipped away some shipments, according to sources.
Operations at major ports in northern China, such as Tangshan and Tianjin, as well as those in eastern China like Shanghai and Zhangjiagang, have faced disruptions since April due to pandemic-led restrictions, sources said.
"Zhangjiagang city has cleared COVID-19 cases by the end of April, but the port is currently still subject to some social gathering restrictions, making shipments still slow," a source added.
In addition to delayed export shipments in April and May, market sources were also concerned about export orders that have been shrinking since April.
One source said overseas steel demand had already slowed, and logistical disruptions could further dampen buyers' enthusiasm.
In April, China's imports of finished steel hit the lowest level since August 2019 at 956,000 mt, down 5.4% on the month and 18.6% on the year. This was partly because of poor domestic demand while disruptions in port logistics also weighed on imports, sources said.
China's total steel imports in January-April reached 4.174 million mt, down 14.7% on the year, according to customs data.
Net finished steel exports in April, as a result, reached 4.021 million mt, up 2.2% on the month although still 40.9% lower on the year. Net steel exports in the first four months dropped 32.6% on the year to 13.982 million mt, the data showed.