[SMM Rebar Daily Review] Spot Prices Continue to Rise, Market Caution Increases

Today, rebar futures fluctuated within a narrow range, closing at 3,315 points, up 0.48%. In the spot market, prices saw a slight increase, but high-level transactions remained sluggish. From the industry perspective, according to the SMM survey, as of February 18, the operating rate of 50 major electric furnace steel mills producing construction materials nationwide stood at 33.16%, up 25.96 percentage points WoW. Currently, 78% of electric furnace mills have resumed operations, with the capacity utilisation rate increasing by 29% WoW. This week, construction steel inventory in Hangzhou reached 1.135 million mt, up 72,000 mt WoW. The pace of inventory buildup has significantly slowed, and with the gradual recovery of demand intensity, the inventory turning point may arrive earlier than expected. Overall, with a slight increase in supply and a gradual recovery in demand, the demand increment is expected to outpace the supply increment. The fundamentals remain positive, and short-term spot prices of construction steel are expected to trend stronger with fluctuations.