SMM Cold-rolled Production Schedule: Daily average production schedule for cold-rolled steel at steel mills basically stable in June According to the latest SMM survey, the total planned volume of cold-rolled commercial materials for 31 mainstream steel mills specializing in cold-rolled sheet and coil in June was 4.344 million mt, a decrease of 5,800 mt or 0.13% compared to the actual production of cold-rolled commercial materials in May. On a daily average basis, June had one fewer day than May, resulting in a planned daily average volume of 144,800 mt for cold-rolled steel in June, up 3.20% from the actual daily average production in May. Table-1: Planned Volume of Cold-rolled Commercial Materials for 31 Mainstream Cold-rolled Steel Mills Data source: SMM Steel SMM Hot-rolled Production Schedule: Daily average production schedule for hot-rolled steel increases by over 5% According to the latest SMM survey, the total planned volume of hot-rolled commercial materials for 39 mainstream steel mills specializing in hot-rolled sheet and coil in June was 14.2862 million mt, an increase of 264,500 mt or 1.89% compared to the actual production of hot-rolled commercial materials in May. On a daily average basis, June had one fewer day than May, resulting in a planned daily average volume of 476,200 mt for hot-rolled commercial materials in June, up 23,900 mt or 5.28% from the actual daily average production of hot-rolled commercial materials in May. Chart-1: Planned Volume of Hot-rolled Commercial Materials for New Sample Steel Mills Specializing in Hot-rolled Steel Data source: SMM Steel This month, the planned volume of hot-rolled commercial materials for 52 mainstream steel mills specializing in hot-rolled sheet and coil, after the expansion of SMM's sample, totaled 17.5282 million mt, with the daily average planned volume increasing by 4.44% compared to the actual production in May. Chart-2: Rolling Sample of Hot-rolled Production Schedule Data source: SMM Steel In June, some steel mills that had undergone maintenance earlier concluded their maintenance and gradually resumed production. Additionally, from the perspectives of profitability and order-taking, the current situation for hot-rolled coil at most steel mills is slightly better than that for construction materials. Overall, the enthusiasm of steel mills for hot-rolled coil production is moderate. Under these combined influences, the daily average production schedule for domestic hot-rolled steel in June increased significantly MoM from May. Breakdown by domestic and foreign trade: Domestic trade: The planned production volume for hot-rolled sheet and coil in domestic trade in June was 13.0984 million mt, with a daily average of 436,600 mt, an increase of 19,300 mt or 4.6% from the actual domestic daily average production in May. Table-2: Comparison of Order-Taking at Some Steel Mills in SMM Survey Data source: SMM Steel According to the SMM survey, as of June 6, although some sample steel mills still had order gaps, most steel mills had basically filled their domestic trade orders, and the order-taking pressure had also increased somewhat compared to early May. SMM will continue to track the subsequent order-taking situation. Foreign trade: The planned export volume for hot-rolled sheet and coil in June was 1.1878 million mt, an increase of 101,800 mt or 9.37% MoM from the actual exports in May. The planned export volume for hot-rolled steel at domestic steel mills in June increased slightly MoM from the actual export volume in May. Chart-3: Planned Export Volume of Hot-Rolled Commercial Products from Sampled Mainstream Steel Mills Data source: SMM Steel In terms of maintenance, the impact from hot-rolled maintenance in June was temporarily 669,000 mt, down 299,800 mt MoM from the previous month. The announced maintenance activities are mainly concentrated in steel mills in east China, north China, and western regions. SMM will continue to track the subsequent situation. For detailed maintenance information, please refer to the following table: Table-3: Maintenance Details of Hot-Rolled Steel Mills Data source: SMM Steel On the profit side, according to the SMM survey on the real-time profitability of steel mills producing HRC, the current real-time profits of most steel mills are concentrated in the range of 50-150 yuan/mt, a decrease from the level in early May. In detail, about 8% of steel mills reported current losses exceeding 100 yuan/mt; 8% reported losses in the range of 50-100 yuan/mt; 15% were at the break-even point; 34% reported profits in the range of 50-150 yuan/mt; and 35% reported profits exceeding 100 yuan/mt. Chart-4: Real-Time Profitability of HRC from Some Steel Mills Surveyed by SMM in the Past Two Months Summary: The daily average planned production of hot-rolled products from domestic steel mills in June increased MoM compared to the actual production in May, mainly due to the gradual resumption of production at some steel mills that had previously undergone maintenance, coupled with the slightly better profitability of producing HRC compared to other products like building materials. Under the combined influence, the daily average production schedule for hot-rolled products in China increased significantly in June. Looking ahead, as the off-season approaches, downstream demand will be impacted to a certain extent and weaken. In terms of supply, the production schedule for hot-rolled products in June increased MoM, in line with market expectations. The inventory pressure for hot-rolled products will gradually emerge in mid-to-late June. However, considering that current inventory levels are at a low point compared to the same period in recent years, the accumulation of fundamental contradictions in the short term will be limited. In terms of news, periodic speculations about external trade wars, macro policies, and rumors of production restrictions on the supply side, in the absence of unexpectedly favorable policy stimuli, the average price of HRC in June is expected to decline slightly.

According to a survey by the World Steel Association (WSA), the main reasons for the consistently low steel capacity utilisation rate in Thailand are due to the reliability, efficiency, and cost of steel mill production. In 2024, the local steel capacity utilisation rate in Thailand was less than 30%, still requiring a large amount of imports to meet domestic steel demand, placing the country in a net import position. At the same time, the absolute value of per capita crude steel consumption in Thailand remains at a relatively low level, with significant room for growth. The local crude steel capacity utilisation rate is low, and in January 2025, the Board of Investment (BOI) of Thailand announced the latest version of the investment promotion guidelines, stating that applications for new long and flat steel product projects would be cancelled, allowing only existing projects to apply for investment incentives based on smart and sustainable industrial standards. Moreover, the incentive levels were uniformly adjusted from the previous A4 or B grade to B grade, reflecting the difficulty in increasing new steel capacity. Therefore, although some anti-dumping investigations have been initiated, the status as a net importer may be hard to change in the short term...

According to the survey by the World Steel Association (WSA), the main reasons for Thailand's consistently low steel capacity utilisation rate are the reliability, efficiency, and cost of steel mill production. In 2024, Thailand's domestic steel capacity utilisation rate was less than 30%, requiring substantial imports to meet domestic steel demand, leaving the country in a net import position. Meanwhile, Thailand's per capita crude steel consumption remains at an absolutely low level, indicating significant growth potential. However, the local crude steel capacity utilisation rate is relatively low. Additionally, in January 2025, the Thailand Board of Investment (BOI) announced the latest investment promotion guide, which stated that applications for new projects involving long and flat steel products would no longer be accepted. Only existing projects meeting smart and sustainable industrial standards are eligible for investment incentives, and the incentive level has been uniformly downgraded from A4 or B in the previous guide to B. This reflects the difficulty in increasing new steel capacity. Therefore, although some anti-dumping investigations have been initiated, the status of being a net importing country may be difficult to change in the short term...

SMM Hot Topic: (Review of 2024 Steel Exports by Category) Second Highest in History! YoY Growth in All Steel Categories in 2024 Improved According to data from the General Administration of Customs, cumulative steel exports from January-December 2024 reached 110.716 million mt, up 22.7% YoY. China's steel exports in 2024 continued to grow, with the total volume approaching the highest level in nearly a decade (second only to the total exports in 2015).

In 2023, China's steel exports exceeded 90 million mt