[SMM survey] Inventory of rebar and wire rod increased in Central China due to off season

Operating rate and forecast of rebar production lines in Central China steel mills

During the survey period (June 18 - June 24), the production of rebar and wire rod in central China increased, leading to inventory accumulation. It is expected that the production of rebar in Central China steel mills will continue to increase in the next period.

During the survey period (June 18 to June 24), the capacity utilization rate of rebar rolling lines in the Central China increased.

Specifically, the production pace in Hunan remained generally stable, one rolling line in Hubei underwent maintenance, and both maintenance and resumption occurred in Henan. However, the resumption increment was greater than the impact of the maintenance, leading to an increase in the total output of rebar in Central China during this period. Regarding factory inventory, recent high temperatures and rainy season weather slowed down downstream procurement, and coupled with low prices, traders were less enthusiastic about restocking, resulting in a significant accumulation of factory inventory.

It is expected that rebar production in the Central China will continue to rise next week, mainly due to the end of maintenance at steel mills in Henan, leading to a resumption of production.

During the survey period (June 18 to June 24), the operating rate of wire rod in Central China increased.

Specifically, the production pace of wire rod in Hunan remained stable, while the rolling lines in Henan reduced their production load. However, in Hubei, the resumption of wire rod rolling lines at some steel mills led to an overall increase in output. In terms of factory inventory, the rainy season impacted shipments, resulting in inventory accumulation.

It is expected that the wire rod output in Central China will continue to rise next week, mainly due to the increased supply from the resumption of rolling lines in Hubei.