62% of Surveyed Steel Mills Are Losing Money

SHANGHAI, Feb 10 (SMM) - According to the profits of steel mills producing HRC surveyed by SMM, about 62% of the steel mills report that they are currently in a state of loss. Among them, 46% of the steel mills are losing more than 100 yuan/mt, and 54% of the steel mills are losing less than 100 yuan/mt.

Looking ahead, after the optimization of pandemic policy, it is increasingly clear that the consumption will recover. In 2023, the macro policy will also maintain the tone of stable growth, while boosting manufacturing investment, infrastructure investment. Meanwhile, the housing market is expected to gradually rally. Hence the market is generally more bullish on the medium and long-term development of 2023

However, considering the material improvement in demand still needs a certain time, SMM believes that short-term HRC futures and spot prices may consolidate, but are with momentum when the demand improves, the social inventory continues to fall amid optimism over the macro front.