Rebar production and inventory data this week showed weakness, and steel prices will continue to consolidate in the short term.
On the afternoon of the 31st, along with the release of the latest weekly domestic steel inventory and production data, domestic steel futures prices rebounded. In response, the ferrous research team at Everbright Futures commented that this week, the apparent consumption of rebar fell, and the production and inventory data showed weakness, Rebar Currently, the overall supply, demand, and inventory are weak, coupled with some uncertainty in the market's expectations for the advancement of anti-involution policies. Under the combined influence, Steel prices may continue to fluctuate and consolidate in the short term.
Specifically, My Steel （ Mysteel ）The latest data released shows that, as of the week ending July 31, domestic rebar production fell by 0.90 million tons to 2.1106 million tons week-on-week, and increased by 133.10 thousand tons year-on-year; social inventories increased by 111.70 thousand tons week-on-week to 3.8414 million tons, and decreased by 1.6708 million tons year-on-year; factory inventories fell by 35.20 thousand tons week-on-week to 1.6215 million tons, and decreased by 290 thousand tons year-on-year. Overall, the apparent consumption of rebar fell by 131.70 thousand tons to 2.0341 million tons week-on-week, and decreased by 122.10 thousand tons year-on-year. "Rebar production has fallen slightly, inventories have increased slightly, and apparent consumption has fallen, with data showing weakness." commented Qiu Yuecheng, Director of Ferrous Research at Everbright Futures.
According to Qiu Yuecheng's detailed introduction, from the supply side, the profits of long-process steel mills are currently at a high level, and short-process steel mills are also slightly profitable, with some steel mills accelerating production, but at the same time, some steel mills are taking turns for maintenance during the off-season, and rebar production has not changed much. On the demand side, large-scale typhoons and rain have occurred across the country this week, significantly affecting construction and logistics, and end-user demand is low.
Mysteel monitoring data shows that the average daily transaction volume of building materials nationwide from Monday to Wednesday was 101.80 thousand tons, down 11.23% week-on-week; the average daily outbound volume of rebar in the Hangzhou market was 29 thousand tons, down 5.23% week-on-week; and the Hangzhou market rebar inventory increased to 633 thousand tons.
"Currently, rebar off-season demand is weak, but supply is also low, and the industry maintains a low inventory situation." Qiu Yuecheng added.
In addition, he also mentioned, "The Central Committee of the Communist Party of China's Political Bureau pointed out that it is necessary to govern disorderly competition among enterprises in accordance with laws and regulations, and to promote capacity management in key industries. The market has some uncertainty about the expected progress of anti-involution policies." In a comprehensive analysis, it is expected that the rebar futures market will fluctuate and consolidate in the short term.
