As of April 7, the operating rate of 50 major construction material-producing electric furnace steel mills nationwide was 41.42%, flat WoW; the capacity utilization rate was 42.6%, flat WoW; daily average production of construction materials was 94,900 mt, flat WoW. During the survey period (March 31–April 7), the overall operating rate of electric furnace mills nationwide remained stable, with fluctuations being relatively small. Currently, profitability of construction material products among electric furnace enterprises showed some divergence. Some enterprises have already fallen into losses due to high raw material costs and declining finished product prices, while others maintained a certain profit margin through strategies of adjusting product specifications and price premiums. Production and operations side, some electric furnace mills are already facing weak shipments and profitability under pressure. Additionally, South China has entered the rainy season, and the rainy and overcast weather conditions will further affect downstream construction progress. If profitability continues to deteriorate going forward, electric furnace enterprises may potentially reduce their operating hours.

This week, stainless steel spot prices fell slightly more than production costs, further worsening the inversion between stainless steel mill prices and costs. Taking 304 cold-rolled products as an example, based on raw material prices on the day, the full cost profit margin was -1.19% this week; calculated based on raw material inventory costs, the margin was -0.55%. Nickel-series raw material costs, high-grade NPI prices remained in the doldrums this week. Although nickel ore prices are currently holding firm and NPI traders are broadly bullish, SHFE nickel futures have been weak recently, while downstream stainless steel prices have struggled to rise. Stainless steel mills themselves are under heavy cost pressure and have shown low acceptance of high-priced raw materials, resulting in sparse market transactions recently; affected by this, high-grade NPI traders have faced considerable transaction pressure, and the price center edged lower slightly. As of this Friday, high-grade NPI with a grade of 10-12% fell by 2 yuan per nickel unit to 1,081.5 yuan/nickel unit. Stainless steel scrap market, stainless steel scrap prices were stable this week, and the decline in finished stainless steel prices did not transmit to the steel scrap market, while prices of substitute furnace charge also remained stable. Tightness in tax invoices eased, the economic advantage of steel scrap became more evident, and high stainless steel mill production schedules drove higher consumption, lifting market transactions and easing inventory pressure. However, finished product prices struggled to rise, limiting upside room for steel scrap prices, which are expected to remain stable in the short term. As of this Friday, the price of 304 off-cuts in Shanghai rose by 100 yuan/mt, with the latest quote at around 10,150 yuan/mt. Chrome-series raw material costs, high-carbon ferrochrome prices dropped back slightly this week. Although some ferrochrome producers recently reported maintenance and production cuts, and stainless steel production schedules for April remained high, leaving retail spot supply in the ferrochrome market relatively tight, stainless steel mills had built relatively ample ferrochrome raw material inventories earlier. Meanwhile, high port inventories of chrome ore recently caused some loosening in chrome ore spot prices. In addition, ferrochrome capacity has already reached a high level, the rainy season in south China is approaching, and ferrochrome producers outside China are resuming production. With ferrochrome producers lacking confidence in the outlook, ferrochrome prices still faced some downward pressure. As of this Friday, high-carbon ferrochrome prices in Inner Mongolia fell 25 yuan/mt (50% metal content) WoW to 8,625 yuan/mt (50% metal content).

SMM Morning Meeting Summary: Overnight, LME copper opened at $12,286.5/mt and fluctuated downward in early trading to a low of $12,212/mt. Copper prices then fluctuated upward, with the center moving up to $12,408/mt, before falling back again to finally close at $12,348.5/mt, down 0.99%. Trading volume reached 20,000 lots, and open interest stood at 295,000 lots, an increase of 3,702 lots from the previous trading day. Overnight, the most-traded SHFE copper 2605 contract opened at 95,660 yuan/mt and dipped to 95,300 yuan/mt in early trading. Copper prices then fluctuated upward, with the center moving up to a high of 96,680 yuan/mt, before fluctuating downward to finally close at 96,150 yuan/mt, down 0.08%. Trading volume reached 36,500 lots, and open interest stood at 181,000 lots, a decrease of 1,608 lots from the previous trading day, mainly due to bulls reducing positions.

Germany's Bundesnetzagentur announced the results for its 1st Feb auction. The rooftop PV tender was undersubscribed, awarding 155 MW across 85 bids at a volume-weighted average price of €0.0956/kWh, slightly down from the previous round's €0.0966/kWh. The price cap was €0.10/kWh. North Rhine-Westphalia led with 50 MW awarded. In contrast, the onshore wind tender was massively oversubscribed, receiving 7,858 MW in bids for a 3,445 MW target. The agency awarded 3,345 MW across 439 contracts at an average price of €0.0554/kWh, marking the lowest level since February 2018. Lower Saxony secured nearly 1 GW of the wind capacity.

[SMM Silicon-Based PV Morning Briefing] Silicon metal: The silicon metal market remained in a weak stalemate. Yesterday, SMM east China oxygen-blown #553 silicon was at 9,100-9,200 yuan/mt, down 50 yuan/mt from the previous day. Weaker expectations for production cuts on the supply side weighed on market sentiment. At the start of the week, futures prices trended weaker, and the center of spot transactions for some cargoes in the market edged lower. Cost support from the raw material side remained firm, and prices may fall back into stalemate. Polysilicon: N-type recharging polysilicon was quoted at 35.5-41.5 yuan/kg. Polysilicon prices have continued to decline recently, mainly affected by market sentiment and inventory exit the market among some leading enterprises. At present, low-priced polysilicon has already fallen below the cost line of some producers, and the sentiment to hold quotes firm has strengthened somewhat. Relevant meetings still need to be monitored going forward.

Vale (NYSE: VALE) has announced a strategic goal to expand its copper and nickel reserves and resources in Canada and Brazil by 20% between 2024 and 2027. Following a strong 2025 performance, Vale reported that its total nickel reserves and resources rose 13% to 14 million tonnes, while copper increased 6% to 53 million tonnes.