Search results for Ferrous Metals Price

SMM Oct 31: This week, the operating rate of galvanising producers reached 57.54%, up 0.06 percentage points WoW. In terms of raw material inventory, zinc prices continued to rise this week, prompting downstream enterprises to cautiously consume existing stocks due to high prices, while large plants awaited long-term contract deliveries, leading to a decrease in zinc ingot inventory. The weekly operating rate remained slightly stable because ferrous metals prices rebounded modestly, downstream traders increased demand, and construction in the north normalized as weather improved. Overall, shipments of galvanized pipes improved WoW. Additionally, due to previous rainfall, enterprises began clearing backlog orders this week, resulting in a slight reduction in finished product inventories. Enterprises increased operating rates to replenish stocks, but held a mediocre outlook on future operations. For galvanized structural components, steel tower orders underperformed expectations, showing a weak peak season. Orders for PV mounting brackets pulled back as construction in the northwest gradually halted, while export orders remained relatively stable. Next week's operating rate is expected to drop back slightly to 57.45%.

During the National Day & Mid-Autumn holiday, the domestic and overseas steel market operated stably. On the first day after the holiday, spot prices of ferrous metals series fluctuated slightly compared to before the holiday. By product category: Iron ore Imported ore During the National Day holiday, while domestic futures were suspended, the most-traded Singapore iron ore swap contract played a "bellwether" role. Influenced by US non-farm payrolls data, expectations for US Fed interest rate cuts increased, leading to a slight rise during the holiday, with the Platts 62% index increasing by $0.3. In terms of spot cargoes, as steel mills had already stockpiled before the holiday, traders mainly took time off, resulting in almost no transactions at domestic ports. On the first trading day after the holiday, the most-traded iron ore futures contract held up well, with spot prices rising 5-10 yuan/mt. Among them, PB fines spot prices at Qingdao port in Shandong mostly quoted around 780-790 yuan/mt. Considering the expectation for post-holiday restocking by steel mills, and the high likelihood of another US Fed interest rate cut in October, along with two important meetings domestically, macro sentiment is positive, and it is expected that short-term iron ore prices will continue to hold up well. In the medium and long term, the supply-demand imbalance of iron ore is gradually accumulating, which will put significant pressure on ore prices. Domestic ore Compared to pre-holiday, the comprehensive price of domestic iron ore fines dropped back slightly during the holiday, with regional trends diverging. Affected by the adjustment of the Platts index, prices in east China and Handan and Xingtai regions in Hebei fell 15–20 yuan/mt; whereas prices in Qian'an and Zunhua regions in Hebei, as well as in Liaoning, remained stable with limited fluctuations. Fundamentally, the supply of domestic iron ore resources remains tight, and blast furnace operations at steel mills are generally stable, with overall fundamentals changing relatively little. It is expected that some steel mills will have restocking needs in the early days after the holiday, potentially boosting the trading sentiment in the domestic iron ore market; however, subsequent trends still need to be monitored based on the overall contraction of steel mill profits. Overall, it is anticipated that domestic iron ore prices may show a slight upward trend in the days following the holiday.   Coke and coking coal During the National Day holiday, the coke market held up well, with mainstream steel mills in Shandong accepting the first round of coke price increases on October 1st, officially implementing a 50 yuan/mt increase for wet quenched coke and a 55 yuan/mt increase for dry quenched coke. Fundamentally, coke production and supply were normal during the National Day holiday. As both coking coal and coke prices rose, the cost of coking increased, reducing coke enterprise profits and restraining the expansion of coke supply. Additionally, during the holiday, downstream purchasing was active, with most coke enterprises selling as they produced, keeping their coke inventories at low levels. Only in some areas, logistics were affected by the holiday and rainy weather, causing some shipping disruptions. On the raw material coking coal front, most coal mines maintained stable production, while individual mines suspended operations for maintenance, resulting in only a slight overall decline in output, which had limited impact on the market. Downstream coke and steel enterprises showed moderate procurement enthusiasm, and the supply-demand imbalance was not yet pronounced, providing some support for coking coal prices. Looking ahead, from a fundamental perspective, coke producers maintained moderate production enthusiasm, and coke supply remained relatively stable. However, most steel mills' coke inventories were at safe levels, and finished product inventories accumulated, leading to generally subdued restocking willingness after the holiday. On the raw material side, the coking coal market performed moderately after the holiday, with slight corrections in prices for some high-grade coal varieties, while most coal prices held steady, thus maintaining cost support for coke. In summary, the coke market is expected to operate steadily in the short term, but further price increases for coke after the holiday will face significant challenges.   Construction Steel During the National Day holiday, national spot prices for construction steel traded within a narrow range, with quotations largely stable in most regions, while individual markets saw fluctuations of 10-20 yuan/mt. On the supply side, blast furnace mills mostly maintained pre-holiday production schedules during the break. Except for some mills where variety steel margins were relatively better, leading to a slight shift in hot metal toward variety steel, construction steel output experienced a minor decline. Additionally, although steel scrap prices declined during the holiday, challenges in scrap collection persisted, and losses at electric furnace mills improved only marginally, prompting them to maintain production rhythms focused on off-peak electricity usage in the short term. Inventory-wise, most merchants took 3-4 days off during the holiday, while some arranged for staff to work on other statutory holidays. However, downstream construction sites were largely semi-idle during the break, with slow progress and relatively limited procurement volumes. Arrivals at markets were normal during the holiday, leading to noticeable accumulation in both producer's warehouses and social inventories. Some resources in producer's warehouses had not yet been transferred to the market, resulting in a faster accumulation rate at producer's warehouses compared to social inventories. Looking ahead, price trends may diverge across regions. Specifically, continued heavy rainfall in southern and northern China may still constrain demand release in the first week after the holiday, making it difficult to quickly alleviate inventory pressure and leading to relatively weak stability in spot prices. However, regions such as east China and southwest China may see significant restocking demand from downstream sectors after the holiday. Previously, downstream players adopted a cautious wait-and-see attitude toward the market outlook and basically stocked up as needed before the holiday. As end-users resume normal construction activities after the holiday, this pent-up demand is expected to be gradually released, potentially driving inventory drawdowns and providing some support to the bottom of spot prices. Overall, short-term construction steel prices still have some upside potential, but medium and long-term performance will depend on the realization of demand during the October peak season.   Sheets & Plates During the National Day & Mid-Autumn Festival holiday, HRC prices in major national markets remained stable. On the first trading day after the holiday, in the east China market, quotations in Shanghai and Zhangjiagang edged up slightly by 10-20 yuan/mt compared to pre-holiday levels. However, inquiry activity in the market was weak, and end-users showed a strong wait-and-see attitude. In the Ningbo market, spot prices at the tail end of today were quoted at 3,360-3,370 yuan/mt, up 10-20 yuan/mt from pre-holiday levels. Traders actively sold goods, but the market trading atmosphere was moderate, with some end-users showing average purchasing enthusiasm. In the south China market, on the 9th, offers in the Lecong market were 3,330-3,340 yuan/mt, up 10 yuan/mt from pre-holiday levels. Overall trading conditions were moderate, with some end-users conducting restocking; most traders were on holiday during the break, and sales performance was average. In the northern market, on the 9th, overall trading performance of hot-rolled coil (HRC) in mainstream northern markets was average. Among them, spot offers in the Tangshan market were 3,300 yuan/mt, up 20 yuan/mt from pre-holiday levels, with a moderate trading atmosphere and average downstream purchasing initiative; offers in the Shenyang market were 3,320 yuan/mt, up 20 yuan/mt from pre-holiday levels, and HRC trading performance was average. In the cold-rolled market, on the 9th, Bensteel Group's cold-rolled DC01 1.0 in Shanghai was quoted at 3,830 yuan/mt, down slightly by 10 yuan/mt from pre-holiday levels. Market prices fluctuated relatively little compared to pre-holiday, trading was average, with no significant improvement. Looking ahead, on the first day after the holiday, the social inventory of HRC in 86 warehouses nationwide (large sample) as surveyed by SMM totaled 4.0965 million mt, up 457,900 mt MoM, an increase of 12.58% MoM, and down 5.45% YoY. By region, south China and north China saw the largest accumulations, both exceeding 15%, while east China, central China, and north-east China had accumulations below 10%. Social inventory accumulated significantly nationwide during the holiday, with the accumulation rate higher than the same period last year, and inventory levels approaching last year's. Attention will be paid to the start of demand and inventory destocking speed in the first one to two weeks after the holiday. In the short term, HRC prices are expected to fluctuate within a weak range, with focus on the most-traded contract range of 3,230-3,330 yuan.   Export and Overseas Markets During China's National Day holiday, most domestic export traders were on holiday and stopped offering quotes. Today is the first working day after the holiday. In terms of export offers, FOB prices for sheets & plates remained stable compared to pre-holiday levels, while long product prices saw a slight decrease MoM. In terms of export order-taking, market inquiries were not active today, and overall trading was weak. Regarding the new income tax payment announcement effective from October 1, which had attracted widespread attention previously, according to SMM surveys, there have been no new implementation progress reports at northern ports currently. MD quotes seem to be emerging again, while southern ports continue to mainly handle tax-included exports due to more complicated procedures. SMM will continue to monitor further developments. On October 7, the EU officially announced the strictest steel import ban in history, reducing the duty-free import quota to 18.3 million mt per year, down 47% from 2024; the tariff rate for excess steel import products increased from 25% to 50%; simultaneously, new traceability requirements for origin (smelting and pouring) were added. The bill aims to replace the steel safeguard measures set to expire in June 2026 and may be implemented by July 1, 2026, at the latest. While the actual impact cannot be estimated for now, barriers facing Chinese steel products exported to the EU are expected to increase. In major global markets, Chinese traders maintained stable export offers. During the National Day holiday, market sales enthusiasm was weak. Indian market sentiment remained sluggish, with weak demand for finished products. Due to the impact of the Dussehra holiday (October 2), trader procurement activities slowed down, and steel prices remained in the doldrums. Russia's Ministry of Finance postponed tax payment deadlines for metallurgical enterprises, including the indexation of the steel excise tax and an increase in its zero threshold, as well as exempting electric furnace metallurgical enterprises from this tax. Steel prices temporarily stabilized, with expectations of future increases. Southeast Asian prices followed fluctuations in the Chinese market, with pre-holiday declines being slightly larger, falling by $3–5/mt, and market transactions were weak. Japan's Daiwa Steel plans to upgrade its section steel rolling mill, expected to be completed by summer 2028. Market traders, considering the short-term supply contraction due to equipment upgrades, have slightly raised steel prices. The European Commission has confirmed a proposal to halve quotas and impose a 50% tariff, leading to rising import prices. Due to increased barrier risks, imported resources have sharply decreased.   Overview of Important Holiday News [EU Plans to Impose 50% Tariff on Extra-Quota Steel Imports] On the 7th, the EU announced steel import restriction measures, proposing to significantly reduce the quota for steel imports eligible for tariff exemptions and raising the steel tariff from 25% to 50%. According to the announcement issued by the European Commission that day, the EU plans to set the annual steel import quota at 18.3 million mt, a 47% reduction compared to the 2024 steel import quota. For steel imports beyond the quota, the EU intends to impose a 50% tariff, doubling the current 25% tariff. The announcement also indicated that the EU will take measures to strengthen origin tracing for melted and cast steel products to prevent so-called "circumvention" practices. The announcement stated that the EU's move aims to address the negative impacts of global steel overcapacity and ensure the long-term development of the EU steel industry as a strategic sector. According to the EU agenda, after the European Commission announced the restriction measures on the 7th, the European Parliament and the Council of the EU will conduct reviews. If approved, these measures will take effect after the current EU measures expire in June 2026. [BHP Accepts Yuan Settlement Requirement!] In October 2025, BHP accepted the yuan settlement requirement for some iron ore trades with Chinese customers. This resulted from China's concentrated procurement strategy and market forces, marking a breakthrough for the yuan in commodity settlement. BHP, after multiple rounds of negotiations with China Mineral Resources Group (CMRG) and related steel enterprises, officially implemented yuan-denominated settlements starting in Q4 2025. The scope of coverage includes: Remaining spot cargoes: accounting for approximately 30% of BHP's total iron ore exports to China (long-term contracts continue to be priced in US dollars, but an "observation period" has been established; if the market acceptance of China's iron ore index, such as the Northern Iron Ore Index, meets the standard by 2026, negotiations for yuan-denominated settlements of long-term contracts may be initiated); Port spot cargoes and CFR transactions: for spot iron ore at Chinese ports, yuan-denominated CFR settlements are adopted, mitigating the impact of US dollar exchange rate fluctuations on enterprise costs. [EU to Cut Import Quotas for Flat Products by 8.5 Million mt] On October 7, the EU announced it would reduce import quotas for flat products by 8.5 million mt. The import cap for hot-rolled coil (HRC) will be 5.2 million mt, the quota for cold-rolled coil will be 1.5 million mt per year, and the quota for hot-dip galvanized products will be 2.85 million mt per year. Quotas will be allocated quarterly, with unused amounts not carried over. All countries, including Ukraine, will be subject to the new measures, meaning any imports exceeding these levels will face a 50% tariff, although the tariff will still be calculated proportionally at the start of the new quota period. [Six Departments Jointly Issue the "Work Plan for Stabilizing Growth in the Machinery Industry (2025-2026)"] Recently, six departments including the Ministry of Industry and Information Technology jointly issued the "Work Plan for Stabilizing Growth in the Machinery Industry (2025-2026)". It proposes that the average annual revenue growth rate of the machinery industry should reach around 3.5% during 2025-2026, with revenues exceeding 10 trillion yuan by 2026, and aims to cultivate a number of competitive characteristic industrial clusters of small and medium-sized enterprises and internationally competitive industrial clusters. [Loudi, Hunan to Add a 5 Billion Yuan Silicon Steel Project] Loudi, Hunan, aiming to build a "Material Valley" in central China and focusing on the "three steels, three electricals, and one titanium" industry chain, has attracted over 80 projects each with investment exceeding 100 million yuan, totaling 36.839 billion yuan in investment. Local enterprises' technological transformation and expansion investments exceeded 10 billion yuan, with Hongwang Group adding a 5 billion yuan silicon steel and titanium materials industry chain project. Since the beginning of this year, Loudi City has thoroughly implemented the decisions and deployments of the CPC Central Committee and the State Council on promoting the development of the private economy. Through three core measures—policy empowerment, industrial concentration, and service efficiency enhancement—the city has promoted high-quality development of private investment. From January to August, the city's private investment grew by 9.1%, with the growth rate ranking among the top in the province, and five enterprises from Loudi were listed among China's Top 500 Private Enterprises. [Fatal Accident at Winning Consortium Simandou (WCS) Iron Ore Project in Simandou, Guinea] A fatal accident occurred at Blocks 1 and 2 of the Winning Consortium Simandou (WCS) iron ore project in Simandou, Guinea, resulting in the deaths of three foreign workers. The project has suspended operations and initiated a comprehensive safety review. This is the second work stoppage at the Simandou mine due to an accident in less than two months. [Hainan: Suspension of Hainan Province's 2025 Vehicle Replacement and Renewal Subsidy Policy Effective October 6] The Hainan Provincial Department of Commerce issued an "Announcement on Further Adjusting Relevant Matters of the 2025 Trade-in Policy for Consumer Goods in the Commercial Sector" on October 4. The announcement stated that the 2025 Hainan Province Vehicle Replacement and Renewal Subsidy Policy will be suspended starting from 00:00 on October 6, 2025. Consumers whose new vehicle "Motor Vehicle Sales Uniform Invoice" was issued before 00:00 on October 6, 2025, can apply for the subsidy as normal; subsidy applications for invoices issued on or after 00:00 October 6 will no longer be accepted. Eligible consumers should submit their applications and upload the required documents via the "2025 Hainan Province Vehicle Replacement and Renewal Subsidy Application Platform" before 24:00 on October 31, 2025; any supplementary information must be completed by 24:00 on November 15, 2025. Failure to submit or supplement information by the deadline will be deemed an automatic waiver of the subsidy eligibility. The announcement stated that subsidies for products such as home appliances, home furnishings, mobile phones, and digital products will continue to be implemented according to the current policy. The vehicle retirement and renewal, and e-bike trade-in subsidy policies remain unchanged. [Vietnam's Capital Hanoi Paralyzed by Heavy Rain Again Within Two Weeks, Triggering Flood Warnings in Multiple Areas] Vietnam's national meteorological agency has issued flash flood warnings for 13 provinces, including Thanh Hoa, Hai Phong, and Bac Ninh. Among them, Bac Ninh is an important manufacturing hub for global electronics suppliers that produce products for companies like Apple and Samsung Electronics. This storm comes one week after Typhoon Bualoi swept through northern Vietnam, causing at least 56 deaths and estimated economic losses of 18.8 trillion Vietnamese dong. Bualoi was the 10th tropical storm to make landfall in Vietnam this year. The meteorological agency predicts that up to four typhoons or tropical depression systems may enter the South China Sea before the end of the year, with one or two potentially affecting Vietnam. [Egypt Launches New Incentive Plan to Support the Steel Industry] Egypt's Ministry of Industry announced the launch of a new incentive package to revitalize industrial growth, with a focus on supporting strategic steel enterprises. The plan includes priority access to competitively priced industrial land, flexible payment terms, loans for working capital and production lines, 24-hour fast-track licensing, and accelerated provision of supporting infrastructure. The Egyptian government aims to reduce import dependency, expand domestic capacity, and establish Egypt as a regional steel export hub. The incentive program offers a series of preferential policies designed to attract and retain industrial investors.   Data Source Statement: Except for publicly available information, all other data are processed by SMM based on public information, market communication, and SMM's internal database model, and are for reference only, not constituting decision-making advice. Note: This article is an original work of this official account. For requirements such as reprinting, reprinting authorization, or cooperation, please contact us. Without permission, it is prohibited to reprint, modify, use, sell, transfer, display, translate, compile, disseminate, or disclose the above content to third parties in any other form, or permit third parties to use it. Otherwise, once discovered, SMM will pursue legal action against infringement, including but not limited to claiming contractual breach liability, restitution of unjust enrichment, and compensation for direct and indirect economic losses.

Forecast for Next Week: Insufficient Short-Term Upside Support; Ferrous Metals Series Prices May Be in the Doldrums This week, the ferrous metals series fluctuated downward. On Monday, five departments issued the "Steel Industry Steady Growth Work Plan (2025-2026)", setting the average annual growth target for the steel industry's added value at around 4% for the next two years, which was positive for market sentiment. However, demand for finished products was not well released, making it difficult for futures to rise. In the latter part of the week, six departments announced a strict ban on new cement clinker and flat glass capacity projects, requiring the formulation of capacity replacement plans. Anti-involution expectations resurfaced, coupled with improved finished product inventory data WoW, leading to a withdrawal of bear funds and a slight rise in futures. However, by the weekend, both the US and the EU announced impending new tariffs on China, causing futures to fall again. In the spot market, suppressed by futures, pre-holiday procurement demand was not significant this week. Short term, according to the SMM survey, hot metal production rose by 17,400 mt WoW and is expected to remain at relatively high levels, providing relatively effective cost support. For steel, terminal restocking demand will gradually proceed in the coming days, but the outlook remains unclear, and the release of terminal purchase demand may fall short of expectations. Overall, although the inventory of the five major steel products shows a destocking trend, weak real performance still cannot support a rise in futures. Upcoming overseas macro tariff pressures may further dampen market sentiment, and domestic macro conditions are unlikely to exceed expectations before the holiday. Therefore, it is expected that the ferrous metals series may continue a fluctuating trend in the doldrums next week. Iron Ore: Weakening Fundamental Support; Increased Risk of Price Decline Next Week This week, iron ore price support mainly came from demand, driven by both increased hot metal production and active stockpiling by steel mills. Looking ahead to next week, steel mills have largely completed pre-holiday stockpiling, and purchase willingness is expected to weaken. Iron ore demand will pull back significantly, reducing price support. Additionally, rising risk aversion before the holiday may further narrow price fluctuations. Overall, iron ore prices are expected to fluctuate rangebound in the doldrums next week. Coke: Market Game; First-Round Price Hike Still Expected to Materialize Supply side, recent increases in coking coal costs and narrowed profits have forced coke enterprises to initiate price hikes. However, without significant losses, production enthusiasm remains moderate, and supply is basically stable. With the National Day holiday approaching, coke shipments have improved. Demand side, steel mills are profitable, hot metal production remains high, and pre-holiday restocking demand for coke exists. But with continued inventory buildup in steel products, resistance to coke price hikes persists. Raw material fundamentals, most coal mines are operating normally, downstream procurement enthusiasm has increased, market transactions are active, mine shipments are smooth, and inventory continues to decline. However, due to poorer downstream profits, coking coal price increases are limited, and the coking coal market may operate generally stable with a slight rise in the near term. In summary, pre-holiday restocking space is limited, and the coke market is expected to remain in a deadlock in the short term, with the first round of coke price hikes anticipated to materialize. Steel Scrap: Dual Factors of Supply and Demand Intertwined, Prices Expected to Continue Sideways Movement Next Week Supply side, affected by typhoon weather, port operations in South China were forced to suspend, regional logistics and transportation systems came to a standstill, steel scrap recycling processes were hindered, upstream resources were difficult to gather effectively, and already collected scrap could not be transported out normally. In the short term, steel scrap supply tightened somewhat. Demand side, overall profitability of EAF steel mills is currently poor, with some electric furnace plants affected by both sluggish market conditions and high cost pressures, leading to production halts and maintenance. According to an SMM survey, as of September 23, the operating rate of 50 EAF steel mills nationwide mainly producing building materials was 37.9%, down 0.6% WoW. Demand-side support for steel scrap procurement further weakened. Overall, both spot and futures prices continued to fluctuate this week. Steel scrap prices lack strong momentum for a significant rise but also possess some resistance to declines due to tight resources. Therefore, steel scrap prices are expected to continue moving sideways next week. Rebar: Demand Release Falls Short of Expectations, Post-Holiday Inventory Buildup Pressure Affects Market Sentiment This week, rebar prices initially rose then fell, with the current nationwide average price at 3,129 yuan/mt, down 11 yuan/mt WoW. Supply side, production profitability of steel mills varies by region currently. Some mills in East China can maintain a net profit of around 50 yuan/mt, while profitability for manufacturers in Northwest and Southwest China is slightly under pressure, with some already at break-even levels. Short-term production remains normal for now, but if profitability worsens further, a shift to producing other steel varieties is likely. Recently, steel scrap prices have been relatively firmer than finished steel, leading to continued declines in profitability for EAF mills, with individual plants planning to reduce operating hours. Short-term operating rates are still expected to decline. Demand side, overall demand saw phased increases this week but has not yet reached last year's level of demand release. Specifically, transaction performance in East China was relatively good, but demand in South China was limited by typhoon weather, and persistent rain in other individual regions caused project waterlogging, making it difficult for demand to improve in the short term. It is understood that the market holds a pessimistic view on post-holiday inventory buildup. On Friday, 100,000 lots of rebar futures warrants exerted downward pressure, possibly pricing in post-holiday inventory buildup pressure early. Looking ahead, weather impact factors in many areas will weaken, pre-holiday restocking demand remains, and spot bottom prices still have support. However, considering the release of post-holiday inventory buildup pressure before the holiday, spot prices may be in a dilemma with limited room for either significant gains or declines. Hot Rolled Coil: Production Increased, Social Inventory Declined Slightly, Macro Tailwinds Provided Limited Stimulus This week, hot rolled coil prices mainly fluctuated weakly. Trading atmosphere during the week was moderate to weak, with transactions primarily occurring at low prices. Prices fell by 20-40 yuan/mt compared to last Friday. On the news front, the six departments issued anti-involution signals during the week, strictly prohibiting new capacity for cement clinker and flat glass, which boosted futures. Subsequently, the tariff hike issue led to another pullback in futures. Fundamentally, the impact from maintenance on hot-rolled coil decreased this week, and production rose WoW. Pre-holiday purchasing willingness among end-users improved, turning social inventory from growth to decline. SMM's national survey of 86 warehouses (large sample) showed social inventory of hot-rolled coil at 3.6793 million mt, down 31,100 mt WoW. By region, except for South China where inventory buildup was significant due to typhoon effects, other regions experienced destocking. However, the transfer speed from producer's warehouses fell short of expectations, and overall inventory continued to build up, though the rate of buildup narrowed significantly. Looking ahead, next week's news will focus on PMI index changes, but overall prices are expected to remain weak and volatile, with the most-traded contract price range at 3,280-3,360. Be cautious of the risk of further price pullback after the holiday. 1. For data mentioned in the report, please visit the SMM database ( 2. For more SMM steel news, analysis reports, databases, etc., please contact Li Ping from the SMM Steel Division at 021-51595782.   *Views in this report are based on market-collected information and comprehensive evaluation by the SMM research team. The information provided is for reference only, at your own risk. This report does not constitute direct investment advice. Clients should make decisions prudently and not use it as a substitute for independent judgment. SMM is not responsible for any decisions made by clients. Additionally, SMM is not liable for losses or liabilities resulting from unauthorized or illegal use of the views in this report. SMM reserves the right to modify and final interpretation of these terms.

SMM August 21 News: This week, the operating rates of galvanising producers recorded 57.42%, a WoW decrease of 1.12 percentage points. In terms of raw material inventory, at the beginning of the week, zinc prices were low, and some companies took the opportunity to restock. After zinc prices slightly rebounded, the restocking sentiment weakened, and zinc ingot inventory increased. The main reason for the higher weekly operating rate was: due to the continued weakness in ferrous metals prices, downstream demand remained weak, with almost no restocking by traders. Sales of galvanized pipes were sluggish, and some companies arranged holidays or reduced production to digest inventories, while finished product inventories increased significantly. Galvanized pipe enterprises still do not have a positive outlook on next week's prices, and the planned production schedule is expected to decrease. For galvanized structural components, there was an increase in steel tower tenders, and overall, steel tower enterprises maintained good operations. However, in the north, some companies implemented production restrictions due to environmental protection issues, which slightly affected operations. Overall, in the Tianjin area, A-level enterprises are currently unaffected, B-level enterprises have 50% production restrictions, and C-level enterprises have suspended production. It is expected to last until September 4th. In surrounding areas such as Tangshan and Hengshui, production restrictions will be determined based on weather conditions, and currently, there are no plans for production restrictions. It is expected that the operating rate will pull back to 56.81% next week.

SMM News on July 24: This week, the operating rate of galvanising producers stood at 59.42%, up 0.29 percentage points WoW. In terms of raw material inventories, zinc prices fluctuated at highs this week, reaching a level that was difficult for downstream users to accept. There was a small amount of restocking driven by rigid demand, leading to a decrease in zinc ingot inventories. The main reasons for the weekly increase in operating rates were as follows: Ferrous metals prices continued to rise, and traders continued to restock, with sales remaining good. Galvanized pipe enterprises were not optimistic about the subsequent prices and demand, so they focused on digesting inventories and realizing profits. Finished product inventories decreased significantly. Some enterprises slightly increased their operating rates to replenish inventories, while others were concerned about a potential pullback in ferrous metals prices and did not have excessive production plans. The planned operating rate for next week is expected to pull back slightly. For galvanized structural parts, except for the relatively resilient orders for steel towers, orders for guardrails, lamp posts, and solar panel mounting brackets remained weak. It is expected that the operating rate will pull back to around 58.29% next week.

SMM News on July 18: This week, the operating rate of galvanising producers was recorded at 59.12%, an increase of 0.84 percentage points WoW. In terms of raw material inventories, zinc prices pulled back to a more acceptable level for downstream buyers at the beginning of this week, prompting some downstream buyers to restock at lower prices. Additionally, the arrival of some long-term contract zinc ingots led to an increase in zinc ingot inventories. The main reason for the weekly increase in operating rates was the continued fermentation of "anti-rat race" expectations, which boosted ferrous metals prices. Ferrous metals prices continued to rise, reigniting traders' restocking sentiment and improving cargo turnover. This increased the production enthusiasm of galvanized pipe enterprises. However, as it was still the off-season, there was no actual increase in demand. After galvanized pipes followed the price increase of ferrous metals, downstream purchase willingness was low, and cargo turnover was poor in the later period. Enterprises reduced their production schedules for the next week, and finished product inventories increased. For galvanized structural parts, some small enterprises were affected by poor demand and suspended production for holidays. Steel tower enterprises performed moderately well and remained resilient. There was a significant polarization in operating rates between large and small enterprises. It is expected that the operating rate will pull back to around 58.79% next week.

SMM July 11 News: This week, the operating rate of galvanising producers stood at 58.29%, up 1.8 percentage points WoW. In terms of raw material inventories, zinc prices pulled back to a more acceptable level for downstream players at the beginning of this week, prompting some downstream players to restock at lower prices, leading to an increase in zinc ingot inventories. The main reasons for the weekly increase in operating rates were as follows: The "anti-cut-throat competition" policy continued to boost ferrous metals prices, which kept rising. Traders' restocking sentiment picked up again, and the order volume for galvanized pipes improved somewhat. Meanwhile, enterprises that had suspended production due to heavy rainfall last week resumed normal operations, leading to an increase in the operating rates of galvanized pipe enterprises and a slight increase in finished product inventories. However, for galvanized structural parts, demand weakened during the traditional off-season, and export orders were not satisfactory. Additionally, affected by high temperatures, some enterprises reduced their operating hours or concentrated production on orders. Despite the continued strong performance of ferrous metals, there was no actual improvement in demand during the off-season. It is expected that the operating rate will continue to pull back to around 58.04% next week. 》Subscribe to view historical spot ferrous metals prices from SMM

SMM News on July 4: This week, the operating rate of galvanizing producers was recorded at 56.48%, up 0.27 percentage points WoW. In terms of raw material inventories, zinc prices continued to fluctuate at highs this week, with downstream purchasing sentiment remaining weak. Restocking was mainly driven by rigid demand or long-term contracts, leading to a decrease in zinc ingot inventories. The weekly operating rate increased slightly, primarily due to the following reasons: Following the Central Financial and Economic Affairs Conference this week, the market focused on eliminating outdated capacity. Ferrous metals prices continued to rise, reigniting traders' restocking sentiment. The sales volume of galvanized pipe orders improved somewhat, prompting some enterprises to increase their operating rates or out of concern that high-temperature and rainy weather might cause white rust on products. Some enterprises focused on depleting their inventories, leading to a slight increase in the operating rates of galvanized pipe enterprises and a decrease in finished product inventories. However, coinciding with heavy rain in the Tianjin area, some enterprises were unable to operate normally this week due to low-lying terrain and inability to drain rainwater, affecting production for approximately 1-2 days. Despite this, the overall operating rate showed an upward trend due to the boost from ferrous metals. In terms of galvanized structural components, demand weakened during the traditional off-season. Operating rates of medium-to-large enterprises remained relatively stable, while competition pressure among small enterprises intensified. Treatment charges (TCs) declined, and poor profits forced enterprises to cut production. Some galvanizing enterprises operated only one shift, resulting in a severe polarization in operating rates between large and small enterprises. If ferrous metals continue to perform strongly, it is expected that the operating rate will continue to rebound to around 57.35% next week. 》Subscribe to view historical spot prices of SMM metals

SMM, February 28: This week, the operating rate of galvanizing producers recorded 57.23%, up 2.95 percentage points WoW. In terms of raw material inventory, zinc prices fell to levels more acceptable to downstream enterprises, leading to an increase in spot pricing at lower levels and a significant rise in zinc ingot inventories. The main reasons for the rebound in operating rates this week are as follows: For galvanized pipes, after the pullback in ferrous metals prices this week, a subsequent rise triggered a "rush to buy amid continuous price rise and hold back amid price downturn" phenomenon among traders. Coupled with relatively low finished product inventories at the terminal, many galvanized pipe traders restocked, resulting in good sales volumes for galvanized pipes. This led to increased operating rates at galvanized pipe factories, which are mostly large-scale producers, significantly driving up the overall operating rate. Finished product inventories also increased. For galvanized structural components, steel tower orders were relatively weak compared to the same period last year, and tender projects still require time to be implemented in galvanizing. Orders for guardrails, lamp rods, and other products depend on feedback from end-users, and actual consumption recovery still requires time. In Tianjin and Hebei, no environmental protection-driven production restrictions related to the Two Sessions have been reported, and enterprises are maintaining normal production schedules. The operating rate is expected to maintain a fluctuating trend next week, rising to around 58.26%. 》Subscribe to view historical SMM metal spot prices

Last week, the ferrous metals series hit new lows again, with a poor start in September. Mid-week, the weak us manufacturing PMI combined with ADP employment data heightened recession expectations. Domestically, rumors of a reduction in existing mortgage rates resurfaced, leading to a cautious market sentiment. In the spot market, steel prices plummeted significantly. This week, end-users were cautious in their purchases, and weekly trading volume decreased WoW. In the short term, recession concerns are intensifying, recent market confidence is low, and apparent steel demand is below the same period in previous years. End-user demand in the peak season is facing challenges, pig iron output is increasing slowly, and short-term steel prices are expected to remain weak. Attention will be on whether the release of us non-farm payrolls data can somewhat alleviate recession expectations.

According to the latest customs data, galvanized sheet exports in July 2024 reached 1.0597 million mt, up 8.07% MoM and 22.54% compared to 864,800 mt in July 2023. From January to July 2024, cumulative galvanized sheet exports totaled 7.2284 million mt, up 15.86% YoY from 6.2391 million mt. Overall, galvanized sheet exports remained high in July. By country, Thailand imported 168,400 mt of Chinese galvanized sheets in July, accounting for 15.89% of total China's exports, ranking first. The Philippines imported 112,800 mt, accounting for 10.65%, ranking second. South Korea imported 83,200 mt, accounting for 7.86%, ranking third. The top three countries for galvanized sheet exports in July remained unchanged. The chart below shows China's galvanized sheet exports in July by country. Galvanized sheet exports in July rebounded from June. SMM believes the main reasons are as follows: 1. Ferrous metals prices continued to decline, enhancing the relative price advantage of domestic galvanized sheets, which boosted exports. 2. Specifically, demand for galvanized sheets in Southeast Asian countries remained strong, with Thailand showing a significant increase in imports from China in July, contributing to the main growth. Entering August, ferrous metals prices continued to fall, but the issue of shipping vessels persisted, leading to cargo backlogs at domestic ports. Some companies had to delay their galvanized sheet exports by half a month to a month. Coupled with ongoing anti-dumping investigations, galvanized sheet exports in August may struggle to increase further.

Since the beginning of the year, CRC prices have been continuously falling, and recently they have accelerated their decline, reaching a three-year low. As an important raw material for galvanized sheets, how does the recent significant drop in CRC and HRC prices impact the galvanized sheet market? Firstly, from the perspective of profit. According to SMM, some producers adopted long-term agreements for raw material procurement. In a declining price market, the raw material prices locked in advance were relatively high. Together with the current off-season consumption, weak demand showed no improvement, putting pressure on galvanized sheet prices, which continued to decline. The production profits of some galvanized sheet producers were compressed, even reaching a loss state, prompting some producers to consider maintenance and production cuts to get through the off-season, affecting the final galvanized sheet operating rate. Secondly, from the perspective of orders. The galvanized sheet market has a traditional sentiment of "buying when prices rise, not when they fall." The rapid decline in black raw material prices made it difficult for end-users to predict future price trends, leading many to adopt a wait-and-see approach, with some galvanized sheet orders being delayed. Additionally, the real estate market remained sluggish this year, and the home appliance and automotive industries also entered the off-season in Q3. Together, these factors continued to weaken the galvanized sheet market. Additionally, by segment, the real estate market remains sluggish this year, with weak orders in the construction segment persisting. In H1, funds from national bonds and other sources were planned for infrastructure construction projects, but consumption has not shown significant improvement yet. Attention should be paid to the implementation effects in Q3 and Q4. The home appliance and automotive industries enter a consumption off-season in Q3, with weakened production and sales impacting their galvanized sheet orders. Although related galvanized sheet producers maintained operations in July, due to continued order declines, some companies are already planning maintenance and production cuts in August. Overall, the decline in ferrous metals prices has impacted the production profits of some producers. Coupled with sluggish downstream demand, galvanized sheet operating rate may remain at low levels in August. Attention should be given to the performance during the consumption peak season.

In April, the prices of ferrous metals bottomed out. The large-scale production cuts by steel mills in February-March led to a comprehensive reduction in steel inventories, alleviating market pressure. The ferrous metals prices continued to fall after the Spring Festival. Prices of some raw materials dropped to the cost line, leaving limited room for further decline. The steel transactions recovered amid rebounding ferrous metals prices, bringing a substantial increase in ferrous metals prices in early April. In mid-to-late April, steel mills resumed production successively amid improved transactions and profits, helping fundamentals of iron ore and coal coke recover. Therefore, raw material prices rose, driving up ferrous metals prices. Looking ahead, the prices of ferrous metals may rise first and then fall in May. The prices of raw materials still have upward room amid production resumption by steel mills in the first half of May. SMM expects steel production to return to a higher level in mid-May. Therefore, inventories will barely reduce amid sluggish downstream consumption, dragging down ferrous metals prices again.