CHINA CRUDE STEEL PRODUCTION SHRANK 2.3%, THE FIRST FALL IN A QUARTER CENTURY

Steel output in China posted the first annual contraction in a quarter century.

Mills in China, which make half of global supply, churned out less last year for the first time since at least 1991 as local demand dropped, prices sank and producers struggled with overcapacity. Crude steel production shrank 2.3 per cent to 803.83 million metric tons, the statistics bureau said Tuesday. December output fell 5.2 per cent to 64.37 million tons from a year earlier.

Demand is weakening as policy makers seek to steer the economy away from investment toward consumption-led growth. The economy expanded 6.9 per cent last year, the slowest full-year pace since 1990, data showed. Steel output will probably drop 2.6 per cent this year, weakening the outlook for iron ore as global miners increase shipments, Citigroup has estimated.