Profit Effect Maximized, Impact from Construction Steel Maintenance Easy to Decrease but Hard to Increase

Published: Jul 29, 2025 10:01

Source: SMM

Save

According to the SMM survey, the impact of construction steel maintenance on output increased slightly this week (7.26-8.1). Some steel mills began to sell other steel varieties, leading to a reduction in the supply of construction steel billets and intermittent production shutdowns of rolling lines. The impact of rolling line maintenance on output this week was 1.2968 million mt, increasing slightly by 16,000 mt WoW.

Last week, in terms of macro news, the expectations from the Political Bureau meeting remained, and market sentiment remained high. Meanwhile, on the raw material side, at the beginning of the week, it was reported that "the General Office of the National Energy Administration issued a notice on organizing and carrying out inspections of coal mine production to promote stable and orderly coal supply." On Friday, a 4.2 magnitude earthquake occurred in Linfen, Shanxi, causing repeated fluctuations in market sentiment in the coking coal market, with multiple daily limit-ups during the week. Market speculation enthusiasm remained high, and high sentiment combined with strong costs guided the upward fluctuation of construction steel futures and spot prices. Rebar prices fluctuated upward, with a national weekly average price of 3,344.8 yuan/mt, increasing by 144.2 yuan/mt WoW. In east China, the profit per mt of rebar generally remained above 200 yuan, and steel mills had strong production enthusiasm, with most maintaining their production pace. The impact of construction steel maintenance on output fluctuated relatively slightly this week.

By region, according to the SMM survey, only individual steel mills in east China adjusted their sales product mix this week, resulting in a reduction in billet allocation for construction steel rolling lines and intermittent production shutdowns of some rolling lines, leading to a slight increase in the impact of construction steel maintenance on output. Rolling lines of steel mills in other regions maintained their maintenance status from last week, with no significant changes in the impact of maintenance on output.

Looking ahead, as multiple positive news items continue to be absorbed, trading enthusiasm has begun to wane, and the market is gradually returning to fundamentals. Currently, there is heavy rainfall in the south and high temperatures persist in the north, affecting construction site work rhythms. Terminal procurement remains mainly driven by rigid demand, with weak off-season demand characteristics evident. Construction steel prices may come under pressure. Iron ore and coke prices are still expected to rise, potentially compressing steel mills' profit margins. However, it is anticipated that a profit of 100 yuan per mt of steel can still be maintained, and steel mills' enthusiasm for construction steel production is unlikely to diminish. Currently, some steel mills have rolling line maintenance plans scheduled to resume production next week, and the impact of construction steel maintenance on output may decrease next week.

Steel

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM‘s internal database model. They are for reference only and do not constitute decision-making recommendations.

For any inquiries or to learn more information, please contact: lemonzhao@smm.cn

For more information on how to access our research reports, please contact:service.en@smm.cn

Related News

1 hour ago

[SMM Daily Chromium Review] Futures Rose While the Spot Market Remained Temporarily Stable, with Limited Adjustment in the Ferrochrome Market

[SMM Chrome Daily Review: Futures Rose While Spot Held Temporarily Steady, Limited Adjustments in the Ferrochrome Market] March 26, 2026 News: Overseas chrome ore quotations were raised, while ferrochrome retail prices temporarily held steady...

1 hour ago

HRC Inventory in the Fourth Week of March 2026

This week, HRC social inventory was 3.4922 million mt, down 22,800 mt from the previous period, down 0.65% WoW, up 31.41% YoY, and up 20.59% on a lunar-calendar YoY basis. This week, HRC mill inventory was 1.159 million mt, down 48,700 mt from the previous period, down 4.0% WoW, up 3.60% YoY, and down 1.91% on a lunar-calendar YoY basis. This week, total HRC inventory was 4.6512 million mt, down 71,500 mt from the previous period, down 1.51% WoW, up 23.17% YoY, and up 14.07% on a lunar-calendar YoY basis.

1 hour ago

2 hours ago

[SMM Iron & Steel] Hoa Phat Boosts Green Energy at Dung Quat Steel Complex

Vietnamese steelmaker Hoa Phat Group has officially launched the second phase of a massive rooftop solar project at its Dung Quat steelmaking complex to enhance energy self-sufficiency and lower carbon emissions. This 22.5 MWp installation spans rolling mills, the hot-rolled coil production unit, and warehouses, generating roughly 32.8 million kWh annually. Set for full completion across five phases by the second quarter of 2027, the $22.7 million initiative will reach a total capacity of 79.2 MWp, cutting carbon emissions by more than 78,000 metric tons per year and improving the mill's export competitiveness in carbon-regulated markets like the EU.

2 hours ago