SHANGHAI, May 13 (SMM) – Scheduled output of rebar in May across 31 major producers of long steel in China is expected to increase 2.98% from the actual output in April and stand at 8.13 million mt, an SMM survey showed on Friday May 10.
High profits and robust demand from construction prompt steelmakers to move up a gear in May. SMM assessed that profits of rebar across large steel mills that produce with blast furnaces averaged 781.25 yuan/mt in May. Steelmakers mostly reported high profits between 700-800 yuan/mt as of Friday May 10.
SMM data showed that activities across major downstream sectors of steel expanded in April, with purchasing managers' index (PMI) for construction rising 5.82 from March, to 53.82 in April.
Surveyed steelmakers in the north planned to produce 1.7 million mt of rebar this month, up 9.5% from the actual production in April, and this accounted for most of the increase in scheduled output.
Separately, the scheduled output of wire rods at surveyed mills in China is likely to grow 8.6% from the realised output in April, to 3.09 million mt in May.
Rebar output for domestic sales is planned at 7.93 million mt in May, up 3.2% month on month, while exports are likely to decrease by 5.7% to 200,000 mt.
Wider price spread of rebar between Chinese and overseas markets deterred exports. Growing domestic supplies are likely to weigh on steel fundamentals this month.