Electric furnace steel: Losses and national standard changes have caused electric furnace steel mills to suspend production intensively

This week, the decline in domestic construction steel prices has slowed down. Some long steel enterprises have taken the initiative to increase production restrictions to cope with the replacement of the old and new national standards for rebar. The quotations of some new standard resources in the market have also increased by 20-30 yuan, which has become a short-term market support. As of August 1, the average price of domestic rebar was 3,295 yuan, down 43 yuan from last weekend.

In terms of raw materials, scrap steel continued to fall this week. The average purchase price of electric furnace steel mills dropped by 62 yuan to 2,246 yuan (excluding tax) from last week, and the arrival of steel mills dropped significantly.

According to statistics, as of August 1, the capacity utilization rate of 135 electric furnace steel mills nationwide was 42.0%, a month-on-month decrease of 5.37%, and the output of electric furnace steel was 262,100 tons/day, falling for 9 consecutive weeks.

Although there has been marginal improvement in recent real estate data, it is still in a weak position. The automobile and home appliance industries have continued to weaken since June. Whether infrastructure can be changed from support to support is the key to the recovery of the market in the future. On July 30, the Political Bureau of the CPC Central Committee stressed the need to speed up the issuance and use of special bonds, make good use of ultra-long-term special government bonds, and support the construction of national security capabilities in major strategies and key areas. The implementation of the above policies is expected to boost steel market demand in the second half of the third quarter. On the other hand, due to continued losses and the replacement of old and new national standards for rebar, many electric furnace steel mills have stopped production for maintenance for about half a month since the end of July, which will largely ease the market inventory pressure. It is expected that domestic steel market prices will gradually stop falling and stabilize in August.