China's Baosteel to trim output in December

Baosteel Group, China's largest steel maker, will cut output in December by delaying reopening a blast furnace that was shut for maintenance, as it faces weak demand, the official China Securities Journal said on Tuesday, citing sources close to the situation.

The initial maintenance shutdown was expected to cut about 1 million tonnes from the company's planned crude steel output for 2008.

The blast furnace produces about 5 million tonnes of pig iron a year.

Baosteel, the parent of Baoshan Iron and Steel, recently said it expected to produce 30 million tonnes of crude steel this year, although it was not clear if that accounted for the 1 million tonnes of production lost due to the overhaul.

The company in December is also likely to shut its low-emission Corex plant, which produces 1.5 million tonnes of pig iron annually, and its medium plate production line, the newspaper quoted the sources as saying.

The global economic downturn, a domestic housing slump and slowing auto sales have hit China's domestic demand and exports.

Top steel mills have cut output by up to 20 percent, partly due to hefty inventories that are losing value and hurting their cash positions.

Baoshan Iron and Steel has said that it expected losses on its key carbon and stainless steel products in the fourth quarter of this year due to slumping prices.