[SMM Analysis] EAF Steel Mill Operating Rates Fall as Off-Season Bites

Published: Aug 5, 2026 09:17

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As of August 4, the operating rate of 50 EAF steel mills in China primarily producing construction steel stood at 33.58%, down 1.96% WoW; capacity utilization rate was 33.67%, down 1.64% WoW; and daily average production of construction steel was 75,000 mt, down 3,600 mt WoW.
During the survey period (July 29 - August 4), the operating conditions of steel mills across multiple regions declined to varying degrees. Specifically, in east China, EAF mills reduced operating hours due to profitability losses, while some mills planned to halt production for nearly a month. In central China and south-west China, many mills cut operating hours amid difficulties in scrap procurement and poor shipments. Mills in south China mostly maintained their current production pace. Overall, the national EAF operating rate continued to decline, with a drop of 1.96%.
Looking ahead, the off-season characteristics of traditional construction steel demand were evident, and market confidence was insufficient. In the short term, construction steel prices may continue to consolidate at lows, and the loss-making situation for EAF mills per mt of steel will be hard to reverse. It is expected that the EAF operating rate will remain at mid-to-low levels in the next period.

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM's internal database model. They are for reference only and do not constitute decision-making recommendations.

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