Galvanising plants operate at higher level in Aug

SHANGHAI, Aug 31 (SMM) – Higher operating rates across large galvanising plants lifted the August average rate across all galvanising plants from July , SMM research found.

The rate averaged 81.78% for August, up 3.44 percentage points from a month ago but down 2.7 percentage points from a year ago, SMM data showed.

Production at small plants received the most impact from restrictions by Tianjin authorities on natural gas supplies and from environmental probes in Jiangsu and Zhejiang provinces. This  drove some orders to large plants and grew operating rates across those plants.

Meanwhile, some medium-sized plants recovered production, which also helped to bolster operating rates.

Sluggish demand continued to grow inventories of finished good across plants. 

SMM expects the average operating rate across galvanising plants to extend its gain next month as the traditional high season of September-October arrives. But plants were less upbeat as orders have not improved after the central authorities indicated that they would step up infrastructure construction.

The rate is expected to increase 1.26 percentage points from August to 83.04% in September, and stand 0.85 percentage point lower than the same period last year, SMM estimated on production plans across plants.