[SMM Rebar Daily Review] End-use demand remains weak, construction steel prices continue to fluctuate rangebound

Today, the futures market continued to oscillate, closing at 3061, down 0.03% from the previous trading day. In the spot market, most quotes remained stable, with only a few regions experiencing some easing, with declines of 10-20 yuan/mt. Trading activity throughout the day was average.

From a fundamental perspective, the supply side remained basically stable. Blast furnace steel mills still had profits and showed little willingness to cut production. EAF steel mills, constrained by profits and steel scrap collection, mostly maintained production during off-peak and mid-peak electricity periods, with limited room for output increases. On the demand side, as the sentiment boost from the temporary easing of Sino-US trade tensions last week gradually faded, the price center of both futures and spot markets shifted downward. Market trading enthusiasm was lackluster, and the pace of inventory destocking slowed slightly. According to the SMM survey, the total rebar inventory this week was 5.6865 million mt, down 2.43% WoW, with the decline narrowing by 2.7 percentage points compared to the previous week. Looking ahead, the current imbalance in the construction steel fundamentals is not prominent. However, influenced by the weak trend in the futures market, end-use demand remains sluggish. It is expected that in the short term, construction steel prices may continue to fluctuate rangebound at their current levels.