Chinese Steel Mills Plan To Cut Wire Rod Output In June In Favour Of Rebar As Poor House Construction Hurts Demand For Former While Latter Is Supported By Infrastructure Sector   

SHANGHAI, Jun 13 (SMM) –SMM survey of 56 key steel mills in China showed their planned rebar output in June is 11.34 million mt, an increase of 140,500 mt or 1.25% compared with the actual output in May; Their planned output of wire rod is 3.59 million mt in June, a decrease of 218,500 mt or 5.73% compared with the actual output in May.

Steel mills' profits improved in early June after rebar prices rebounded, with rebar in losses of 0-100 yuan/mt and profits of 0-200 yuan/mt. Despite weak demand in the off-season, most rebar steel mills have no plans to cut production in June due to low inventories on hand and healthy profits.

Many steel mills plan to cut output of wire rod in June in favour of rebar. Wire rod demand is weaker than in previous years due to falling demand from house construction, while rebar demand is slightly better than wire rod thanks to support from infrastructure sector.