Weekly Survey of Rolling Lines in Central China

Operating Rate and Forecast for Construction Steel Production Lines at Steel Mills in Central China

During the survey period (March 3–March 9), the operating rate and capacity utilization rate of rebar and wire rod rolling lines in Central China increased to varying degrees.

During the survey period (March 3–March 9), the operating rate and capacity utilization rate of rebar rolling lines in Central China both rose.
Specifically, during the survey period, a few blast furnace mills in Hunan carried out scheduled rolling-line maintenance on rebar rolling lines, resulting in a slight reduction in local rebar supply. Meanwhile, five EAF steel mills in Hubei and Henan resumed production in a concentrated manner, driving a sharp increase in overall rebar supply across the region. In terms of mill inventory, rebar inventory shifted from rising to falling this period, mainly because downstream construction sites gradually resumed work and rigid-demand purchases improved. In addition, a sharp rise in futures on Monday improved market trading activity, leading to overall inventory drawdowns.
Rebar production in Central China is expected to continue increasing next period, mainly because EAF steel mills resumed production of rebar rolling lines in a concentrated manner this period, and the number of operating days next period will be higher than this period, lifting the capacity utilization rate for rebar.

During the survey period (March 3–March 9), the operating rate and capacity utilization rate of wire rod rolling lines in Central China rose to varying degrees.
This was mainly because two additional EAF steel mills ended their annual leave as scheduled and resumed normal production this period, while simultaneously resuming wire rod rolling lines, driving a certain increase in wire rod production. In terms of mill inventory, wire rod inventory edged down this period, mainly because end-use demand gradually recovered and rigid-demand purchases improved, shifting mill inventory from rising to falling. However, given that rebar futures were broadly stable last week, market trading activity was not strong and distributors’ willingness to purchase was relatively weak, so the overall pace of inventory drawdowns was relatively small.
Wire rod supply in Central China is expected to continue increasing next period. On the one hand, EAF steel mills resumed wire rod rolling lines this period, and the number of operating days next period will be higher than this period, lifting the capacity utilization rate for wire rod. On the other hand, a few steel mills in Hubei plan to resume production of a wire rod rolling line on an irregular basis to meet order demand. Taken together, wire rod production is expected to continue increasing.