[SMM survey] More blast furnaces under maintenance in July, pig iron production expected to decline

According to SMM survey data, six additional blast furnaces underwent maintenance in June, reducing daily pig iron production by 28,800 mt. The maintenance of blast furnaces was mainly concentrated in north China. Meanwhile, seven blast furnaces resumed production, increasing daily pig iron production by 35,300 mt. The resumption of blast furnaces was relatively dispersed, with slightly more in north-east and central China compared to other regions. SMM survey data showed that blast furnace maintenance in June resulted in a net reduction of pig iron production by 4.7391 million mt, up 346,300 mt MoM. By the end of June, daily average pig iron production decreased slightly by 2,100 mt MoM from the end of May.

According to SMM survey data, as of now, nine additional blast furnaces are planned for maintenance in July, which will reduce daily pig iron production by 44,700 mt. In contrast, four blast furnaces are expected to resume production, increasing daily pig iron production by 22,000 mt. Based on the current data, it is estimated that blast furnace maintenance in July will affect a total pig iron production of 5.1709 million mt, an increase of 431,800 mt compared to June. Pig iron production in July is expected to pull back. According to SMM's daily pig iron production estimates, the daily average pig iron production by the end of July will be approximately 2.41 million mt, slightly down MoM.

SMM expects that the actual pig iron production in July will be lower than the current statistical data. This is mainly constrained by three factors:

First, the seasonal off-season effect will deepen, leading to increased pressure from steel inventory accumulation, and narrowing steel mill profits will trigger voluntary production cuts;

Second, crude steel production control policies in multiple regions will enter the implementation phase, coupled with weakening end-use demand, which may lead to earlier-than-expected maintenance plans by steel mills;

Third, environmental protection-driven production restrictions in Beijing-Tianjin-Hebei and surrounding areas will intensify, and the extended production restriction periods in key steel mill regions such as Hebei will significantly suppress blast furnace operating rates.

SMM will continue to monitor pig iron production-related developments.