Pre-holiday Restocking Nears End; Rebar to Consolidate in Short Term

From September 20 to 21, Wang Hongzhi, Party Leadership Group Secretary and head of the National Energy Administration, led a team to Jilin to survey energy investment, winter peak energy and power supply, new-type power grid construction, and new fuel development. Wang Hongzhi stressed the need to expand the scale of energy investment and accelerate the construction of major energy projects. Fully advance new-type power grid construction and appropriately push forward the implementation of new-type power grid project tasks ahead of schedule. Leverage Jilin's resource advantages and actively and orderly promote the high-quality development of industries such as new energy, hydrogen energy, and green fuels. Broaden investment channels, improve service levels, and actively attract various enterprises, especially private enterprises, to participate in energy project construction. Solidly carry out all work related to winter peak energy and power supply to ensure the people stay warm through the winter. Attach great importance to workplace safety and safeguard high-quality energy development with high-level safety.

The CPCA released data showing that from September 1-20, retail sales of passenger vehicles in China reached 878,000 units, down 22% YoY and up 8% MoM. Cumulative retail sales since the beginning of this year reached 2.593 million units, down 21% YoY. From September 1-20, retail sales of new energy passenger vehicles in China reached 596,000 units, down 9% YoY and up 14% MoM. Cumulative retail sales since the beginning of this year reached 7.27 million units, down 12% YoY. From September 1-20, the penetration rate of new energy vehicles in China's passenger vehicle retail market was 67.9%. From September 1-20, the penetration rate of new energy vehicles in wholesale shipments by passenger vehicle producers in China was 73.9%.

Today, the most-traded HRC contract drifted lower, closing at 3,301, down 0.18% intraday. Spot prices were mostly stable, with some markets seeing catch-up declines of 10-20 yuan/mt. In terms of supply, this week's HRC impact from maintenance was 109,700 mt, down 12,900 mt WoW. Next week's HRC impact from maintenance is 82,600 mt, down 27,100 mt WoW, leaving HRC supply relatively ample. Demand side, spot pullback room before the holiday is relatively narrow, with traders and steel mills mainly holding prices firm, and some end-users showing slightly higher stockpiling enthusiasm. Raw material side, according to an SMM survey, daily average hot metal output this week was 2.3943 million mt, down 4,800 mt WoW, with further declines likely ahead, weakening cost support. Watch for negative feedback risks after the holiday. Looking ahead, cost support is unlikely to provide a strong directional trend in the short term. Pre-holiday procurement demand is being released in some markets, and HRC social inventory is destocking. The most-traded HRC contract is expected to mainly move sideways in a narrow range in the short term.