Operating Rate and Forecast of Construction Material Production Lines at Steel Mills in Central China
During the survey period (April 22-28), the capacity utilisation rate of rebar rolling lines in Central China increased slightly, while the operating rate and capacity utilisation rate of wire rod rolling lines both increased.
Source: SMM
During the survey period (April 22-28), the capacity utilisation rate of rebar rolling lines in Central China increased slightly.
Specifically, in this period, some steel mills in Hubei province began to sell billets and cut rebar production due to strong billet orders and higher profits from billets than rebar. However, a new rolling line resumed production in the region, and output gradually recovered. As a result, rebar production in Central China still increased slightly under the combined effects. In terms of in-plant inventory, influenced by factors such as the meeting of the Political Bureau of the CPC Central Committee and rumors of "supply reduction", market sentiment improved. Meanwhile, agents restocked before the Labour Day holiday, leading to a significant decrease in overall in-plant inventory.
It is expected that rebar production in Central China will shift from increasing to decreasing next week, mainly due to the planned shutdown of an additional rebar rolling line in Hubei province starting from May 1, which will lead to a decline in capacity utilisation rate.
Source: SMM
During the survey period (April 22-28), the operating rate and capacity utilisation rate of wire rod rolling lines in Central China both increased.
Specifically, although some steel mills in Hubei province sold billets and cut production of both rebar and wire rod, a new wire rod rolling line resumed production in Henan province on April 23. The impact of the resumed rolling line outweighed the production cuts, resulting in a significant increase in overall supply. In terms of in-plant inventory, agents' willingness to purchase increased, leading to a decrease in overall inventory.
It is expected that the growth rate of wire rod production in Central China will narrow in the next period, mainly due to the lack of news about new rolling line maintenance or production resumptions in the region. Meanwhile, the rolling lines that resumed production this week can maintain normal production next week. As a result, the overall operating rate of wire rod rolling lines will remain stable, and the capacity utilisation rate will increase slightly.
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