Home / Metal News / Steel & Iron Ore / [short process Steel Plant Operation rate] in addition to the price, there is also the operation rate. [short process Steel Plant Operation rate] in addition to the price, there is also the start-up rate.
[short process Steel Plant Operation rate] in addition to the price, there is also the operation rate. [short process Steel Plant Operation rate] in addition to the price, there is also the start-up rate.
Jun 5,2019 19:06CST
The content below was translated by Tencent automatically for reference.


[arc furnace steel works]

According to SMM research, the statistical sample start-up rate of 33 home appliance arc furnace steel mills in June reached 79%, which is still at a high level after a year, and while there is still profit and the toughness of rigid demand for building materials is still present, most steel mills report that there is no production reduction or maintenance plan at present. Therefore, the spot price pressure will not be reduced in the short term. However, it is worth noting that, on the one hand, the starting rate this month is slightly lower than that of last month (80%). Mainly in the case of continuous fermentation of the contradiction between supply and demand, local especially in the southern market spot prices continue to decline, resulting in steel mill profits are compressed. According to the SMM iron and steel data model, according to the tax scrap steel price of 2430 yuan / ton, as of today, the profit of electric arc furnace steel plant is 152 yuan / ton, down 147 yuan / ton from the highest value 2999 after the year. On the other hand, the regional differences in the start-up of electric arc furnace steel plants have begun to highlight. According to SMM research, although the feedback of electric arc furnace steel mills in East China is still profitable, it has been reduced by 100 to 150 yuan per ton. Due to the relatively high spot price, the feedback from steel mills in southwest China still has about 150 to 200 yuan per ton. At the same time, some steel mills in South China have plans to cut or stop production because they are already on the brink of profit and loss or even lose money.


Steel mill A (East China): at present, the two electric furnaces are in normal production, but the profit has been reduced. According to the ex-factory price of 3800 yuan per ton in the past two days, the profit is only 50 to 80 yuan per ton.


Steel mill B (East China): at present, the profit is only 30 to 50, about two weeks ago, there was a profit of nearly 300 per ton. Recently, it is clear that demand has fallen, shipments have been sharply reduced, so it has been reducing the price of shipments, it is expected that the future price will continue to weaken, but so far there is no production reduction plan.

Steel mill C (Central China): although the opening period has been slightly reduced this month (currently at 18 hours / day), a 50t electric furnace has been changed to 70t this month. On the contrary, the actual output has increased by 2 to 3 tons, and the profit situation is now in the state of capital preservation, but there is a plan to reduce production if the demand is not good in the later period.

Steel mill D (South China): in the middle and late May, the local area was beset by rainy weather, the willingness of terminals to take goods was affected, the release of demand was not smooth, the ex-factory price has fallen for one month in a row, and this month's profit has also shrunk by 30 to 50 yuan per ton. It is understood that there are many electric arc furnace steel enterprises due to almost no profit or even loss, and there are plans to reduce or stop production.


Steel mill E (southwest): because the early price is higher, so the local electric furnace factory has the increment, the peripheral Hunan Hubei resources arrival quantity also has the increase, therefore the recent price falls rapidly, the current profit is about 150 yuan / ton, looks at the short-term downward space is limited

Steel mill F (southwest): since the middle and late May, the arrival of goods from the north, especially Shanxi, and other places has increased, coupled with the local rainy season, demand has fallen, and prices have also dropped. At present, the profit is about 200 yuan per ton. However, due to the rapid decline in prices, it is expected to be in a weak adjustment state in the short term.



[billet rolling enterprise]

According to the data of the SMM survey, as of June 5, the operating rate of billet rolling enterprises reached 77%, down 1 percentage point from the previous month. Most enterprises reflect that they are still on the brink of profit and loss, and some enterprises have reduced production because of their pessimistic mentality.


Steel mill F (East China): the cost is about 3800, barely profitable, the current three rolling line start-up rate of about 50-60%, feel that demand has fallen, prices are expected to continue to weaken slightly in the later period.


Steel mill G (Tangshan): under the influence of environmental protection and production restrictions, it is still in the state of starting in the first half of the month after the shutdown of production.


Steel mill H (South China): at present, the cost has not changed much (using the previous billet inventory, the billet cost is 3550 to 3600 yuan / ton), but it is not optimistic about the future, so there is no new billet inventory.


daily review

For queries, please contact Frank LIU at liuxiaolei@smm.cn

For more information on how to access our research reports, please email service.en@smm.cn