Seasonal lull weighs on operating rate at galvanising plants in Jul

SHANGHAI, Aug 2 (SMM) – Operating rates at galvanising plants across China fell in July as producers in the north cut output by 20-50% on environmental probes, and as fewer orders in the low season grew inventories of finished products at major plants.

Some galvanising plants cut production last month as rising prices of steel products added to costs. This also accounted for the lower operating rate. 

The operating rate came in at 78.3% in July, down 2.82 percentage points from June and down 5.14 percentage points from last year.

As the low season could extend to mid-August, orders at plants are expected to pick up in the second half of this month.  

In August, the operating rate is likely to rise 2.64 percentage points from July to 81%, SMM estimated from production plans across plants. On a yearly basis, the rate is expected to be 3.5 percentage points lower.