A Wave of Production Halts Is Expected to Hit, Electric Furnace Operating Rates Set to Plunge Next Week

Published: Feb 5, 2026 10:26

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As of February 3, the operating rate of 50 domestic steel mills mainly producing construction materials stood at 39.72%, down 1.1% MoM; the capacity utilization rate was 39.63%, down 2.08% MoM; the daily average production of construction materials was 88,300 mt, down 4,600 mt MoM.
During the survey period (January 27–February 3), domestic spot construction material prices were in the doldrums, market trading activity was sluggish, and most downstream end-users entered the pre-holiday wrap-up phase, leading to a sharp reduction in procurement demand, which significantly weighed on construction material prices and lowered electric furnace mill profitability. Approaching the Chinese New Year, electric furnace mills gradually began their holiday breaks, with four additional mills halting production this week, located in east China and southwest China.
Looking ahead, as the Chinese New Year approaches, the scope of electric furnace mill halts is expected to further expand. Currently, 21 operating electric furnace mills plan to implement holiday production halts within the week, indicating a clear trend of tightening market supply. Therefore, operating rates for domestic electric furnace mills are projected to drop significantly next week.

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