This week, finished steel continued its gradual decline, while raw materials began to stabilize, with coking coal rebounding to some extent. During the week, rumors about a coal mine accident in Shanxi and customs clearance restrictions at the Mongolian border spread, boosting sentiment. Coupled with the China Mineral Resources talks, the raw materials side rebounded from lows. In the second half of the week, as rumors of maintenance at steel mills across various regions emerged, negative feedback expectations intensified somewhat, and raw materials pulled back. Approaching the weekend, however, the 10th round of coke price increases was initiated, pushing coking coal and coke futures higher. In the spot market, the off-season characteristics of end-users became increasingly evident, with the market restocking at low prices as needed. With spot prices remaining relatively firm, the spot-futures price spread continued to widen...

As of Friday, SiMn 6517 (cash) in north China was at 5,600-5,700 yuan/mt, down WoW; in south China, SiMn 6517 (cash) was at 5,650-5,750 yuan/mt, down WoW, and SiMn 6014 (cash) there was at 5,450-5,500 yuan/mt, down WoW. Recently, SiMn futures moved weakly sideways in a narrow range, with a strong wait-and-see sentiment in the market, low willingness to sell among producers, and weak spot and futures prices.

July 3 Brief: Northern ports: South African high-iron ore 30.5-31.4 yuan/mtu, down WoW; South African semi-carbonate ore 37.2-37.7 yuan/mtu, flat WoW; Gabonese ore 40.6-41 yuan/mtu, flat WoW; 46% Australian lumps 43.3-43.8 yuan/mtu, flat WoW; South African medium-iron ore 37-37.5 yuan/mtu, flat WoW. Southern ports: South African high-iron ore 33.5-34 yuan/mtu, down WoW; South African semi-carbonate ore 36.5-37 yuan/mtu, flat WoW; Gabonese ore 41-41.5 yuan/mtu, flat WoW; 46% Australian lumps 43.2-43.7 yuan/mtu, down WoW; South African medium-iron ore 37-37.5 yuan/mtu, flat WoW. The manganese ore market is stable but stagnant, end-use demand is weak, and buying and selling are dominated by wait-and-see sentiment.

This week, the domestic iron ore concentrates market weakened slightly with regional divergence. Prices in Tangshan, Qian’an, and Qianxi of Hebei were basically stable; western Liaoning’s Chaoyang, Beipiao, and Jianping areas pulled back slightly by 5-10 yuan/mt; east China pulled back 10-15 yuan/mt. Looking ahead to next week, China’s iron ore supply tightness is expected to be hard to ease. Demand side, according to SMM tracking data, hot metal production of steel mill blast furnaces may pull back slightly, weakening support for iron ore concentrates. Steel mills’ desire to bargain down prices will remain dominant. The tug-of-war between sellers and buyers persists. Next week, the domestic iron ore market is expected to be in the doldrums overall. [SMM Steel]

Rebar prices drifted lower this week. The nationwide average price now stands at 3,089 yuan/mt, down 20 yuan/mt WoW from last Friday. Supply side, steel mill margins continued to shrink. A few blast furnace steel mills have gradually arranged maintenance and production cut plans, but most are still operating at previous levels. Attention will remain on the extent of production cuts. Among EAF steel mills in different regions, margins diverged slightly. In southwest China, electricity price subsidies during the rainy season kept margins relatively favorable, and most mills maintained previous output levels for now. However, in east China, adjustments to critical peak electricity pricing during the summer led to shorter operating hours, while in south China, high inventory pressure at steel mills also prompted reduced operating hours. Overall EAF production declined. Demand side, intermittent rainfall in east China this week slowed project construction progress. In central and northwest China, low-priced inflows from other regions encouraged downstream buyers to adopt a wait-and-see stance. Overall transaction performance was mediocre. Inventory side, total inventory continued to edge up. Given weak demand expectations, social inventory will remain in a phase of periodic accumulation. Looking ahead, supply-side margins turned worse, weakening production incentives, but soft demand provides limited support to bottom prices. While raw material side saw some sentiment-driven momentum, the underlying rebar fundamentals remain weak. Short-term market prices are likely to consolidate near the bottom. Future attention will be on the pace of inventory buildup.

BHP said blast furnace decarbonisation remains crucial as over 70% of global steel output still uses the BF-BOF route. The company noted that EAF and DRI expansion faces scrap supply and iron ore quality constraints, while BF emissions can be reduced through recycling, hydrogen injection, CCUS and higher-grade raw materials. With new integrated steel plants costing around 4 billion USD and 85% of China and India’s BF capacity less than 20 years old, full replacement remains difficult in the near term.

Iron ore prices followed an initial rise and subsequent decline this week, with the price center shifting further lower. The core drivers were that after the ninth round of coke price cuts was implemented, steel mill losses widened further. Combined with expectations of environmental protection-driven production restrictions in some regions, blast furnace maintenance plans increased, hot metal production continued to pull back, and the demand side was clearly under pressure. In terms of supply, global iron ore shipments and China’s port arrivals both increased MoM, with supply-side pressure intensifying somewhat and further weighing on ore prices. During the week, market talk that benchmark negotiations might restrict low-grade ore port cargo pick-up pushed futures to a short-term rebound. However, the market broadly viewed the probability of this measure actually being implemented as low, and after sentiment was released, price logic returned to a demand-led mode. Affected by this, spot prices performed weaker than futures. In port spot cargoes, the weekly average of the MMI 61% index slipped 5 yuan/mt MoM. Chart: MMI 61% Port Spot Index Source: SMM The domestic iron ore concentrate market edged lower this week, with regional divergence in performance. Prices remained basically stable in Tangshan, Qian’an, and Qianxi in Hebei. Areas such as Chaoyang, Beipiao, and Jianping in western Liaoning edged down by 5-10 yuan/mt. East China saw a pullback of 10-15 yuan/mt. Overall domestic ore production remained steady, but the resource landscape diverged by region. Supply in Hebei remained somewhat tight; within this, the Chengde area saw a further contraction in resource supply due to a mining accident, which provided some support to local iron ore concentrate prices. On the demand side, hot metal production at steel mill blast furnaces remained at a high level, still offering support to iron ore concentrate demand. However, steel mill profits have narrowed significantly recently, and the overall desire to bargain down prices is strong, causing local iron ore concentrate prices to edge down slightly. Chart: Tight Domestic Ore Supply Supports Prices — Domestic vs. Imported Ore Price Spread to Widen Further Next Week Outlook for Next Week Looking ahead to next week, the probability of the 10th round of coke price increases being implemented is relatively high. Increasing steel mill maintenance resulting from losses will lead to a larger decline in hot metal production. Iron ore demand will continue to deteriorate. Meanwhile, mines will push shipments in June, and imported ore port arrivals still have upside room over the next two weeks, leading to a slight accumulation in port inventories. In addition, a new round of talks between the US and Iran is scheduled for mid-month, and crude oil prices still face downside expectations, so iron ore shipping costs will remain weak. Iron ore prices will remain under pressure. However, considering the disturbance from benchmark negotiation news, there may be opportunities for a price rebound. Overall, iron ore prices are expected to remain in the doldrums next week. Domestically, the tight iron ore supply situation is expected to be difficult to alleviate. But given that demand for iron ore concentrates has weakened somewhat, steel mills’ push for lower prices will continue to dominate. The game between sellers and buyers continues. Overall, the domestic iron ore market is expected to be in the doldrums next week, but the decline may be smaller than that for imported ore.

In yesterday's [SMM Analysis] EU Steel Tariff Wall Doubles to 50%: Reconstructing the New Quota System & In-Depth Analysis of 1A HRC, SMM deeply analyzed the brutal allocation logic of the EU's new 18.35 million tonnes quota. When the "50% tariff wall" and the "melting and pouring" rules completely block traditional tax-free export paths, the global steel supply chain is undergoing a forced reshuffle. Today, we shift our perspective to the ripple effects and macro-level forecasts of this storm.

According to SMM's tracking survey data, the daily average pig iron production in June increased by 20,000 mt from May. The average daily hot metal production in July is expected to decline by around 12,000 mt MoM from June.

According to SMM statistics, both mill inventory and social inventory experienced varying degrees of buildup. Total construction steel inventory reached 8.2329 million mt, up 213,600 mt WoW (up 2.66% WoW), further intensifying inventory pressure.