Consumption Expectations Are Gradually Materializing, and Galvanizing Operating Rates Continue to Increase [SMM Galvanizing Weekly Review]

SMM, March 20: This week, the operating rate of the galvanizing industry was 59.7%, up 6.69 percentage points WoW. Raw material side, zinc prices pulled back sharply this week, and galvanising enterprises actively fixed prices and stockpiled, with zinc ingot inventory rising significantly. The rise in the operating rate this week was mainly due to the end of environmental protection-related controls in north China on March 15, and the industry as a whole has now basically returned to normal pre-Chinese New Year production levels. By segment, the galvanized pipe sector stood out in particular: before the Chinese New Year, traders generally did not carry out large-scale winter stockpiling due to falling prices of ferrous metals; this week, spot ferrous metals prices stabilized and rose, end-user procurement demand was gradually released, willingness to purchase strengthened, and traders began concentrated restocking and stockpiling, directly driving improved orders for galvanising enterprises and continued destocking of finished product inventories. The structural parts segment also maintained solid momentum: orders in the steel tower sector remained robust, while some export-oriented products such as transport facilities, steel towers, and sections posted steady order performance. Overall, end-use consumption in the galvanizing industry has gradually exhibited the characteristics of the traditional peak season, with strong support from the demand side. Considering raw materials, orders, and the recovery in production, the operating rate of the galvanizing industry was expected to continue edging up slightly next week, likely reaching around 60.19%.