[SMM Survey] Weekly Survey of Wire Rod Rolling Lines in Central China: Poor Profitability for Rebar-in-Coil, with Diverging Performance Next Week

Operating Rate and Forecast for Construction Steel Production Lines at Steel Mills in Central China

During the survey period (August 11–August 17), the operating rate of rebar rolling lines in the region was flat, while the capacity utilization rate edged up.

Data source: SMM

During the survey period (August 11–August 17), the operating rate of rebar rolling lines in the region was flat, while the capacity utilization rate edged up.

Specifically, steel mill production diverged this period. A few steel mills in Hunan made modest production cuts due to poor profitability; meanwhile, some steel mills in Henan redirected hot metal back to construction materials, lifting the capacity utilization rate slightly. As a result, supply increased marginally this period. As for mill inventory, it shifted from decline to increase this period, mainly because shipments were relatively weak in Henan and Hunan due to rainy weather.

Rebar supply was expected to decrease somewhat next period, mainly because a few steel mills in Henan had blast furnace production resumption plans, with some hot metal diverted to the hot-rolled coil production lines, lowering the rebar capacity utilization rate.

Data source: SMM

During the survey period (August 11–August 17), both the operating rate and capacity utilization rate of wire rod in Central China remained stable.

During the survey period, steel mill profitability was poor. The wire rod rolling lines that had originally planned to resume production continued to be shut down for maintenance, keeping overall supply temporarily stable. As for mill inventory, futures performance improved slightly this week and market sentiment recovered somewhat; steel mill shipments were moderate, mill inventory continued to decline, and inventory pressure eased slightly.

Against the backdrop of the off-season with weak demand, steel mill wire rod production was expected to remain stable next period.

All data other than publicly available information were processed by SMM based on publicly available information, market communication, and SMM’s internal database model, and are for reference only and do not constitute decision-making advice.