SMM Daily Rebar Commentary: Prices Rise Amid Rumors of Production Restrictions, Market Sentiment Boosted

[SMM Daily Rebar Commentary]

Today, there was no guidance from the futures market, but influenced by rumors of crude steel production restrictions during Friday's night session, spot cargo prices across various regions all rose, with increases ranging from 20 to 40 yuan/mt. Trading performance throughout the day was moderate.

From a fundamental perspective, on the supply side, EAF steel mills, affected by profitability, mostly maintained their previous production levels, with construction material production remaining relatively stable. Blast furnace steel mills have recently undergone additional maintenance, leading to a reduction in supply pressure after the holiday. On the demand side, influenced by rumors of crude steel production cuts, market sentiment was significantly boosted. Coupled with the ongoing restocking demand ahead of the May Day holiday, steel inventory continued to decline. Some provinces experienced shortages of rebar specifications, and the support at the bottom of steel prices remained relatively firm. Overall, the market currently maintains a weak balance between supply and demand, with relatively small fundamental imbalances. Short-term prices are likely to fluctuate with market sentiment. It is expected that steel prices will continue to hold up well tomorrow, but at the same time, caution should be exercised regarding potential sentiment changes due to the insufficient sustainability of the rumors' popularity.