[SMM Survey] August saw a surge in blast furnace maintenance, pig iron output may plummet

In July, end-user demand remained sluggish, and the market was in the off-season. Coupled with panic selling caused by the transition between the old and new national standards for rebar, steel prices fell to new lows, and steel mills generally suffered losses. Under these circumstances, some blast furnaces that were originally scheduled to resume production in July were forced to delay their resumption, and some steel mills even brought forward their annual maintenance plans. Since mid-July, the number of blast furnace maintenance activities gradually increased. According to an SMM survey, 19 blast furnaces were actually under maintenance in July, reducing pig iron output by 809,200 mt; meanwhile, 10 blast furnaces resumed production, increasing pig iron output by 771,800 mt. Overall, pig iron output in July saw a slight increase compared to June. July's blast furnace maintenance affected a total of 4.42 million mt of pig iron output, 90,000 mt less than in June, with average daily output rising slightly by 3,000 mt.

In August, steel mills faced dual pressures in their operations. On the one hand, the extent of losses for steel mills further expanded, deepening the degree of losses; on the other hand, the transition between the old and new national standards for rebar led to a significant increase in the number of blast furnace and rolling line maintenance. According to the latest tracking data from SMM, 16 blast furnaces are planned for maintenance in August, reducing average daily pig iron output by 57,600 mt; in contrast, 14 blast furnaces are planned to resume production, increasing average daily pig iron output by 53,300 mt. Overall, total pig iron output in August is expected to decrease by 4.7784 million mt, down 358,500 mt MoM, with average daily pig iron output decreasing by approximately 11,900 mt.

However, SMM believes that steel mills nationwide are generally facing losses, especially in certain regions and for specific types of steel. Until end-user demand significantly improves, steel demand is expected to remain weak. Some steel mills may add new blast furnace maintenance plans, so the actual number of maintenance activities in August may exceed expectations, and the average daily pig iron output may be lower than current estimates. SMM will continue to track this on a weekly basis.