SMM HRC Daily: Futures Decline, Spot Trading Sentiment Improves Amid Supply Pressures

[SMM HRC Daily Review] Futures Remain Weak, Spot Trading Improves

HRC futures market continued to fluctuate downward today, with the most-traded contract closing at 3,370, down 0.89%. Supply side, the impact from maintenance on HRC this week was 155,900 mt, down 36,800 mt WoW. The impact from maintenance next week is expected to be 149,700 mt, down 0.62 WoW, leading to a slight rebound in supply pressure. Demand side, as futures continued to decline, the market began to make just-in-time procurement at lower prices, and trading sentiment improved compared to yesterday. Raw material side, according to the SMM survey, pig iron will continue to rebound, and there is still a possibility of twelve rounds of coke price adjustments, creating room for ore. Overall, with specific details of the crude steel production reduction policy yet to be announced, the macro front lacks strong drivers, and market sentiment has cooled, with bearish sentiment returning. It is expected that the most-traded HRC contract will continue to fluctuate downward in the short term, but support at the previous low may hold as long as the supply-demand pattern does not deteriorate.