SMM Steel reported on August 12 that according to SMM statistics, the estimated total shipments of resources in mainstream markets this week were 331,700 mt, up 18.25% WoW from the previous week's shipment level. By market:

[SMM Daily Coke Market Briefing] In terms of supply, cost pressure persists, with most coke enterprises operating near the break-even point, limiting their capacity for production increases in the future. However, coke sales are smooth, with no sales pressure. On the demand side, steel mills are enjoying good profits, with fewer instances of voluntary maintenance. The decline in hot metal production is slow, and some steel mills have low coke inventories, resulting in moderate enthusiasm for overall coke procurement. In terms of news, market rumors suggest that due to the military parade on September 3rd, some coke enterprises have received verbal notifications of environmental protection-driven production restrictions, requiring a 30%-50% production cut from August 16th to early September. In summary, it is difficult to increase coke supply, and the fundamental situation remains tight. In the short term, the coke market may continue to hold up well, with strong expectations for the sixth round of coke price increases to be implemented.

Last Friday, China's steel export prices surged by $4-10/mt. In the Thai market, import prices for cold-based galvanizing, hot-based galvanizing, and industrial wire rods also increased, with a WoW rise of $5-30/mt. The main reason for the steel price hikes was that the steel varieties circulating in these local Thai markets were mostly from Chinese resources. Therefore, as domestic prices in China surged rapidly, import prices in Thailand also adjusted accordingly. However, according to the SMM survey, although some adjustments in guidance prices stemmed from the significant surge in domestic prices in China, in terms of transaction volumes in the Thai market, the situation was relatively mediocre, with most transaction prices remaining low.

[SMM Daily Briefing on Coal and Coke] In terms of supply, coke enterprises have seen improved profitability, leading to increased production enthusiasm and a slight increase in coke supply. Coke enterprises have smooth shipments, maintaining their coke inventory at a low level. Demand side, steel mills, supported by profits, have maintained moderate production enthusiasm. Hot metal production fluctuates at highs, and there is a rigid demand for coke. Some steel mills with low inventory have been actively procuring coke. In summary, the fundamental situation of coke remains tight. However, prices of some coal types have recently seen a correction, weakening cost support. In the short term, the coke market may hold up well with a slight rise, and the sixth round of coke price increase has been postponed.

This week, the ferrous metals series rebounded from a low position but then saw some pullback. In the first half of the week, the main driving force for the market rally was coking coal. The further advancement of coal capacity verification led to a rise in coking coal futures, driving an overall rebound in the ferrous metals series. Market sentiment reached a new high amid rumors of production restrictions during the military parade and crude steel output reduction. In the second half of the week, the rumors cooled down, coupled with poor performance in supply and demand data for finished steel products, futures began to pull back. In the spot market, trading was moderate in the first half of the week, but mostly driven by speculative demand for calendar spreads. The performance of end-users remained generally lackluster...

[SMM Daily Coke Market Brief] On the news front, mainstream coke producers have initiated a sixth round of price increases for coke, ranging from 50 to 55 yuan/mt. In terms of supply, coke producers' profits have improved recently, leading to increased production enthusiasm and a rise in coke supply. However, coke shipments have been smooth, and coke inventories at coke producers remain low. On the demand side, steel mills have seen improved deliveries recently, and with relatively good profits, they maintain a high level of enthusiasm for coke procurement. In summary, the increase in coke supply is limited, and cost support remains strong. In the short term, the coke market may hold up generally stable with a slight rise, and the market holds certain expectations for a sixth round of coke price increases.

According to the latest tracking by SMM, the planned production volume of HRC commodity materials for August from 39 mainstream steel mills producing HRC totaled 14.4211 million mt, up 70,500 mt from the actual production volume of HRC commodity materials in the previous month, representing a 0.5% increase. On a daily average basis, the planned production volume of HRC commodity materials for August was 465,200 mt/day.

[SMM Daily Briefing on Coal and Coke] In terms of supply, the profitability of coke enterprises has improved, and the supply of coke has increased. Currently, the shipment situation of coke enterprises is good, and their own coke inventory remains low. Demand side, the arrival situation of steel mills has improved, and their own coke inventory has increased slowly. However, the pig iron production of steel mill blast furnaces remains at a high level, creating a rigid demand for coke and maintaining the previous procurement pace. In summary, the arrival situation of steel mills has improved, and the supply-demand imbalance of coke has eased somewhat. However, the cost support remains strong, and the coke market may operate generally stable with slight rise in the short term.