SMM Review and Forecast on Rebar Prices

SHANGHAI, May 23 (SMM) - Rebar futures fell 0.58% today to 3,588 yuan/mt. The spot transactions were sluggish. According to SMM research, some blast furnaces resumed production with an improvement in marginal profits. EAF mills in Guizhou all shut down amid low profits, and those in central China, south China and other places suspended their production due to tight steel scrap supply. As a result, the overall supply of construction steel rose only slightly. On the demand side, the number of infrastructure and housing construction projects both decreased, while the demand from existing projects was low, dragging down construction steel prices and transactions.
The stable coke prices and the slower drop in iron ore prices may offer certain support to steel prices. It is rumoured that Hebei is conducting research on steel mills. This move may prepare for the steel output control policy. Besides, the end demand for construction steel will hardly exceed expectations as there will be no favourable policy stimulus. On the whole, short-term steel prices may hover at lows.