[SMM Survey] Central China Rolling Line Weekly Survey: Rebar and Wire Rod Production Diverges, Wire Rod Supply Sharply Reduced

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

During the survey period (July 21–July 27), rebar supply in Central China was stable, while the operating rate and capacity utilization rate for wire rod both declined.

Data source: SMM

During the survey period (July 21–July 27), steel mills in the region largely maintained their previous production pace, with both the rolling line operating rate and capacity utilization rate remaining unchanged.

Inventory side, mill inventories saw some growth during the period, mainly concentrated in Hunan and Henan, primarily because futures were in the doldrums, leading to low purchase willingness from agents.

In the next period, mills have no plans to change production, and rebar supply is expected to remain stable.

Data source: SMM

During the survey period (July 21–July 27), the operating rate and capacity utilization rate for wire rod in Central China both declined.

Specifically, the changes were concentrated in Hubei region. First, some mills had satisfied their previous order requirements for wire rod production, and considering the limited benefits of current wire rod production, they had no plans to continue production, leading to a lower rolling line capacity utilization rate. Second, a steel mill in the region chose to halt two wire rod rolling lines due to poor shipments, causing a simultaneous drop in the operating rate. Combined, these factors led to a reduction in wire rod supply during the period. Inventory side, mill inventories in the region showed slight divergence: in Hubei, mill inventories declined slightly due to reduced supply; in Hunan and Henan, downstream purchase enthusiasm was moderate, and mill shipments decreased somewhat, resulting in slight inventory accumulation.

Wire rod supply is expected to continue declining in the next period, mainly because a few mills in Hubei region halted wire rod rolling lines this week, resulting in fewer operating days in the next period than in the current one, which will lead to a lower rolling line capacity utilization rate.

Data other than public information are all based on public information, market communication, and SMM’s internal database models, processed by SMM, and are for reference only. They do not constitute decision advice.