Steel Mills Suffer Losses, And Rebar Output Were Still Declining

SHANGHAI, Oct 12(SMM) – According to SMM survey, 56 sample data of key steel production companies:

The planned production of rebar in October is estimated to be 10.0264 million mt, down 83,700 mt or 0.83% MoM.

The planned production of coiled rebar in October is expected to be 3.7866 million mt, up 60,000 mt or 1.61% MoM.

Note: Starting from April 2022, the SMM rebar production sample was expanded to 56 companies.

The steel price trend continued to fluctuate upward during early October. Affected by overseas market news, domestic market sentiment was sluggish. Coupled with limited demand, support for prices was weak. While raw material prices remained high, some coke companies planned a third price hike. The profit margins of steel mills continued to shrink, with overall profits between (-300, -50) yuan. The market performance of HRC and steel plates was poor. Therefore, in October, some steel mills arranged year-end routine maintenance. In addition, encountering the intensification of cost losses, steel mills adjusted their production accordingly, resulting in a constant narrowing of rebar output in October.

Looking forward, the fundamental imbalance between supply and demand in the construction steel market became prominent after the holiday. Combined with the impact of negative external news, spot prices were under downward pressure. However, raw material prices remained high and steel mills suffered serious losses. The planned output of BF steel mills in October will reach a relatively low of this year, while the profitability of EF steel mills was average, so most steel mills will maintain medium-low production levels.