[SMM Rebar Daily Review] Rebar futures drifted lower, and spot rebar followed with weak transactions.

Rebar futures consolidated lower today, with the most-traded contract closing at 3,060, down 0.65% from the previous trading day. Spot side, market quotes mostly followed the futures decline, down 10-30 yuan/mt, and transactions were subdued.
Fundamentals side, supply side, production cuts at EAF steel mills increased recently, while most blast furnace steel mills maintained prior operations. According to an SMM survey, the impact from maintenance on construction steel this week was 781,900 mt, down slightly WoW, keeping overall supply stable. Impacted by profitability, some steel mills in North China and Central China plan to suspend wire rod production in the short term, leaving limited room for supply growth. Demand side, persistent high temperatures and rainfall across many regions hindered short-term construction progress, further dragging down off-season consumption. Combined with the weak futures trend, market confidence in the outlook was insufficient, with most participants remaining cautious and on the sidelines, and purchase willingness low. Going forward, amid the demand off-season, the “weak reality” is unlikely to ease, and construction steel fundamentals lack sufficient self-driven momentum. Meanwhile, raw material side still faces expectations of price cuts, weakening cost support. As a result, prices are expected to continue consolidating on a subdued note in the near term.