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[SMM thread] supply increment is less than expected, April steel plant production schedule and March basically the same!
Apr 10,2020 17:45CST
translation
Source:SMM
According to the SMM survey, the thread output of the blast furnace steel plant, which mainly produces building materials, in April was 7.717 million tons, which was basically the same as the actual output in March (0.17%), of which the domestic trade supply increased by 0.58%, and the reel output increased by 145000 tons (7.5%), of which the domestic trade supply increased by 8.6%.
The content below was translated by Tencent automatically for reference.

SMM4, 10 Jun: according to SMM research, the thread output of the blast furnace steel mill that mainly produces building materials in April was 7.717 million tons, which was basically the same as the actual output in March (0.17 percent), of which the domestic trade supply increased by 0.58 percent, and the reel output increased by 145000 tons (7.5 percent), of which the domestic trade supply increased by 8.6 percent.

On the whole, after the relative impact between the reduction caused by the maintenance reduction and the increment caused by the hot metal turn, there was no significant fluctuation in the production schedule of the long process steel plant this month.

Reduction: increase in maintenance and production reduction in steel mills

In addition to some steel mills forced by inventory and financial pressure to reduce material production by reducing the ratio of addition to waste, according to SMM statistics, as of April 10, according to the maintenance information released by steel mills, the reduction of building materials caused by overhaul in April was 754800 tons, an increase of 121200 tons over March.

Table 1: list of overhaul of building materials in steel mills from March to May (unit: 10,000 tons)

 

 

Source: SMM

 

Increment: hot metal steering thread

Under the traction of high profits, some steel mills will be used to produce industrial wire, coil and other products of hot metal to the production of rebar. According to SMM estimates, as of April 10, the profit per ton of steel produced by long process steel mills was higher than that of hot coils by 250 yuan, and most steel mills said that the current production of hot rolled coils was already in a state of loss.

Figure 1: profit difference of coil steel per ton

 

 

Source: SMM

[subregional]

North China and Northwest China: thread scheduling increased by 9.89% and 4.87% respectively this month compared with the previous month. Mainly due to: on the one hand, in the early (March) Hebei, Shanxi and other areas of steel mills maintenance and production reduction is relatively concentrated, recently, with the gradual recovery of demand, steel production has also returned to normal one after another. On the other hand, some steel mills have hot metal steering operation. Only in the current sample, the increment of building materials caused by hot metal steering in North China is as much as 170000 tons.

Northeast region: this month thread scheduling month-on-month ratio-3.26%. The profit situation of the local steel mill is not good, some steel mills even lose more than 100 yuan per ton of steel, the production enthusiasm is slightly lower than that of other regions.

East China, Central and South China: thread scheduling fell 3.06% and 2.03% respectively this month compared with the previous month. The inventory pressure of local steel mills is more severe, and the maintenance of steel mills is relatively more concentrated.

Table 2: production schedule of building materials in regional steel mills in April 2020

Source: SMM

 

As far as the later stage is concerned, it is expected that the supply side will continue to be in a state of high and slow growth, but in view of the traction of profits, the current thread production lines of long and short process steel mills have basically been in a state of full production, so in addition to the continuous resumption of production, the space for continued increment is relatively limited.

 

 

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