Based on a recent Steelease survey of major steel downstream industries, the steel PMI was 48.74 in February 2014 up 11.59 MoM but down 0.68 YoY. After being seasonally adjusted, the reading was 46.48 on the month up 4.28 MoM but down 0.41 YoY.

Business activities in most steel downstream industries were depressed by the Chinese New Year holiday, with the reading generally below 50. The transportation sector however, gained the momentum to expand.

In summary, production at major steel downstream sectors was hampered by the Chinese New Year holiday, but the increase in new orders will help improve production in the coming month. The transportation outperformed others in February, with the PMI rising above 50.