[SMM Daily Review of Hot-rolled Coil] Supply-demand imbalance begins to accumulate, rebound of futures coil prices hindered

Today, the most-traded HRC futures contract first rose and then stabilized, with the 2510 contract closing at 3089, unchanged MoM. Spot prices remained stable overall. In terms of supply, the impact from maintenance on hot-rolled coil production this week was 172,600 mt, a decrease of 35,800 mt WoW. Next week, the impact from maintenance on hot-rolled coil production is expected to be 158,800 mt, a decrease of 13,800 mt WoW, indicating a continued rebound in supply pressure. On the demand side, with the arrival of hot and rainy weather, the terminal processing data in some markets have gradually entered off-season levels, and the manufacturing sector is mainly purchasing as needed. In terms of raw materials, pig iron production may continue to decline in the short term, and the third round of coke price cuts is imminent, with prices expected to remain in the doldrums. The cost support for HRC has slightly weakened. Overall, today's futures market fluctuated based on the situation of the China-US talks. Attention should be paid to the actual outcomes of subsequent talks. In June, HRC may gradually show a pattern of increasing supply and decreasing demand. Exports remain the biggest support for current prices. Attention should be paid to SMM's weekly shipping data and terminal processing data. Before new positive macro factors emerge, it is expected that HRC prices will remain in the doldrums in the short term.