[SMM Steel Market Morning Brief] US April CPI Up 3.8% YoY

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Macro

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[US April CPI Up 3.8% YoY, Above Market Expectations]

The US Consumer Price Index (CPI) rose 3.8% YoY in April, hitting a new high since May 2023, above the market estimate of 3.7% and the previous value of 3.3%. CPI increased 0.6% MoM, in line with expectations.

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[Blue Rainstorm Warning Continues: Heavy Rainstorms Expected Locally in Hunan, Jiangxi, Fujian and Other Areas]

The Central Meteorological Observatory continued to issue a blue rainstorm warning at 18:00 on May 12: From 20:00 on May 12 to 20:00 on May 13, heavy rain to rainstorms are expected in parts of eastern Guizhou, central Hunan, central and southern Jiangxi, central and western Fujian, and northeastern Guangxi, with heavy rainstorms (100–0.12 mm) locally in eastern Hunan, central Jiangxi, and western Fujian. Some of the above areas will experience short-duration heavy rainfall (maximum hourly rainfall of 20–0.04 mm, locally exceeding 0.05 mm), with thunderstorms, strong winds, hail, and other severe convective weather locally.

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[US April Core CPI Up 2.8% YoY]

The US April core CPI rose 2.8% YoY, above the estimate of 2.7% and the previous value of 2.6%. The US April core CPI increased 0.4% MoM, above the expected 0.3%.

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Industry & Downstream

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[Zhengzhou Plans to Add 45 New Urban Renewal Projects This Year, Targeting 120 Billion Yuan in Investment]

Recently, the Zhengzhou Municipal Bureau of Urban-Rural Construction publicly solicited opinions on the "Zhengzhou 2026 Annual Urban Renewal Plan (Draft for Comments)," targeting 45 new projects to be added in 2026, with a goal of completing 120 billion yuan in investment. The draft mentioned deepening urban health check work. From four dimensions—urban districts, neighborhoods, communities, and housing—urban health check work will be deepened, with the street-level health check coverage rate raised to over 70%, focusing on specialized fields and key areas to conduct specialized health checks and compile urban health check reports.

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[SMM Electric Furnace Operating Rate] Individual Electric Furnace Mills Resumed Production, Operating Rate Up 1.3% WoW

As of May 12, the operating rate of 50 major construction material-producing electric furnace steel mills nationwide was 41.9%, up 1.32% WoW; the capacity utilization rate was 43.0%, up 0.99% WoW; daily average production of construction materials was 95,700 mt, up 2,200 mt WoW.

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Other Hot Topics

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⭕[China Automobile Dealers Association: Auto Dealer Inventory Totaled Approximately 2.6 Million Units at April Month-End]The China Automobile Dealers Association released the April 2026 "Auto Dealer Inventory" survey results: The comprehensive inventory coefficient for auto dealers in April was 1.89, up 7.4% MoM and up 34.0% YoY. According to statistics from the Passenger Car Branch of the China Automobile Dealers Association, terminal sales of passenger vehicles reached 1.384 million units in April. Based on this calculation, auto dealer inventory totaled approximately 2.6 million units at April month-end.

⭕[Ministry of Water Resources: Will Carry Out Standardized Construction and Renovation of Small Water Supply Projects Based on Local Conditions]Ni Wenjin, Director of the Rural Water Resources and Hydropower Department of the Ministry of Water Resources, stated that the goal is to raise the national rural tap water popularization rate, the proportion of rural population covered by large-scale water supply projects, and the county-level unified management ratio to 97%, 73%, and 77% respectively by the end of 2026. Meanwhile, local governments will be guided to continuously expand the scope of integrated urban-rural water supply and large-scale water supply through implementing provincial-level rural water supply high-quality development plans, with the goal of raising the national rural tap water popularization rate to 98% by 2030. He noted that for rural residents whose tap water coverage remains difficult to achieve by 2030 due to natural geographic, economic, and other constraints, standardized construction and renovation of small water supply projects will be carried out based on local conditions, with the promotion of technical equipment suitable for water supply needs in high-altitude, high-cold areas and remote pastoral regions, to continuously improve the level of water supply security and water quality compliance rates.

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