Crude steel output from the Middle East region increased 28.7 per cent year-on-year in March, while first quarter output was up 24.4 per cent from Q1 2017, according to data published by the World Steel Association (worldsteel).

Middle East steel output totaled nearly 3.3 million tonnes (mt) in March and more than 9.4 mt for Q1, helping drive global crude steel output for the 64 countries reporting to the Brussels-based industry group up to 148.3 mt for March.

Global crude steel production rose four per cent in March as mills in top producer China ramped up output after winter restrictions were lifted and as US producers took advantage of import tariffs to churn out more metal.

The steel industry, worth about $900 billion a year, is seen as a gauge of the world’s economic health. Q1 global production stood at nearly 426.6 mt – a 4.1 per cent increase, figures from worldsteel showed.

Iran led the Middle East region›s growth, with production rising by an estimated 43.7 per cent year on year for March and by 47.0 per cent for Q1.

Iran’s share of the March figure is estimated at almost 2.4 mt, and at roughly 6.8 mt for Q1, according to worldsteel. Asian steel output was around 294.1 mt in Q1, up 4.6 per cent over Q1 2017. Asia›s March production was almost 102.2 mt, a 4.3 per cent increase on year.

Crude steel output from China, which produces about half the world’s steel, rose to 74.0 mt, up 4.5 per cent from March 2017 after winter restrictions to combat smog were lifted mid-March. China, which realised a 5.4 per cent year-on-year rise in Q1, generated nearly 212.2 mt of crude steel in the first three months of 2018.

“(The) rebound in steel demand post Chinese New Year was slower than expected, but... we are seeing (a) healthy course of demand and reducing steel inventories,” Greg Lilleyman, chief operating officer at Fortescue Metals Group, said.

The worldsteel data showed India, which this year overtook Japan to become the world’s second largest steel producer, boosted output by 5.3 per cent in March, while Japan boosted output by 2.2 per cent.

In the US, steel output rose 5.3 per cent to 7.3 mt as imports fell after President Donald slapped hefty duties on steel aimed at dissuading China from exporting its excess metal onto global markets. Its Q1 production was up 2.2 per cent on the year to more than 20.7 mt.

“The Steel Executives at our recent dinner left us thinking (hot rolled coil) prices may stay above $800/t until the Fall, import volumes may stay low and take longer to arrive, and low U.S. inventories and robust demand may extend the up cycle,” said Morgan Stanley in a note to clients.

Production in the 28 European Union countries was up just 0.9 per cent for the quarter, at almost 43.1 mt, and 0.5 per cent up for March, at 15.1 mt.

Overall global steel capacity utilisation for the 64 reporting countries was 74.5 per cent in March -- 2.2 percentage points higher year on year, worldsteel said.

Earlier this month, worldsteel raised its forecast for 2018 global steel demand growth to 1.8 per cent from 1.6 per cent previously, citing favourable global economic momentum, though it expects Chinese steel demand to remain flat this year.

This is as economic growth in the world’s second largest economy decelerates and the government continues to steer the country away from investment-led to consumption-led growth.

Global steel equity values have more than doubled since hitting 12-year lows in early 2016 in the worst of the steel sector crisis. Worldsteel represents more than 160 steelmakers accounting for 85 percent of global output.