Northern Environmental Protection Affected the Start of Galvanizing Operations [SMM Weekly Galvanizing Review]

SMM News, April 3: This week, the operating rate of the galvanizing industry was 58.75%, down 0.13 percentage points WoW. Raw material side, zinc prices fluctuated at highs this week, and galvanising enterprises mainly digested inventories, while with only limited earlier priced orders and long-term contracts, zinc ingot inventories at galvanising enterprises edged down slightly. The decline in the operating rate this week was mainly due to environmental protection-driven production restrictions in some northern regions, which affected operations. By segment, consumption of galvanized square tubes remained solid, with robust end-use demand, while orders for galvanized round tubes weakened markedly as the property market softened. Some galvanizing plants promptly adjusted their product mix, increasing the production and sales of square tubes. Overall, consumption of galvanized pipes remained resilient. The structural parts segment also maintained solid momentum: orders in the steel tower sector remained robust, and orders for some export-oriented products such as transport facilities, steel towers, and sections were steady, providing some support on the demand side, but remaining weaker YoY. Some enterprises plan to take 1-2 days off for the Qingming Festival next week, and the operating rate of the galvanizing industry is expected to decline to 58.68% next week.