【EAF】Statistical Survey of Independent Electric Arc Furnace Production in China on April 5, 2024

As of April 5, 2024, a survey of the production status of 87 independent electric arc furnace steel mills in China (including 76 independent electric arc furnace enterprises producing construction steel) is summarized as follows:

1. The average operating rate of the 87 independent electric arc furnace steel mills in China is 68.93%, a decrease of 1.35 percentage points month-on-month, and a decrease of 7.37 percentage points year-on-year. Among them, the South and Central regions slightly increased, while the East and Southwest regions slightly decreased, and the Northeast region significantly decreased, with other regions remaining stable. Pay attention to the operation of the graphite electrode market.

2. The average capacity utilization rate of the 87 independent electric arc furnace steel mills in China is 52.08%, a decrease of 0.98 percentage points month-on-month, and a decrease of 14.31 percentage points year-on-year. Among them, the Central region slightly increased, the South region slightly increased, the Southwest region slightly decreased, and the Northeast and East regions significantly decreased, with other regions remaining stable.

3. The daily crude steel output of the 87 independent electric arc furnace steel mills in China decreased by 1.84% month-on-month.

4. The weekly production of rebar from 76 independent electric arc furnace steel mills for building materials decreased by 2.69%, and the weekly production of coiled rebar decreased by 1.45%.

5. The profit situation of the products of 76 independent electric arc furnace steel mills for building materials in China is as follows: 18.42% of the steel mills are slightly profitable, 52.63% of the steel mills break even (some of which remain break-even due to shutdown), and 28.95% of the steel mills are at a loss.

This week, the operating rate and capacity utilization rate of independent electric arc furnaces in China slightly declined. Looking at the specific situation of steel mills starting and stopping production this week: one steel mill in the South China Guangdong region shut down a 70T electric furnace on the 30th, affecting a daily production of approximately 0.06 thousand tons, expected to resume production in mid-April; one steel mill in the South China region resumed production of a 120T electric furnace on the 28th, currently producing about 0.2 thousand tons daily; one steel mill in the Central China Henan region resumed production of an 80T electric furnace on the 3rd, producing about 0.1 thousand tons daily. Meanwhile, steel mills in Fujian, Guizhou, Liaoning, and other regions that had ceased production last week due to losses continued to opt for shutdown, with no set date for resumption, leading to a slight decline in the operating rate.

In the current uncertain steel market situation, electric arc furnace steel mills are suffering significant losses. Only steel mills in regions such as South China and Southwest China can maintain a profit level through valley electricity production, with most steel mills still operating at a loss. With the current poor demand for finished materials, reducing production is a common consensus among market participants. Therefore, most electric furnace factories maintain 8-12 hours of production time and are gradually reducing production time to lower capacity utilization rates.

Looking into next week, one steel mill in the Central China Hubei region plans to shut down on the 4th, involving one 70T electric furnace, affecting a production of about 0.1 thousand tons. It is expected that the operating rate and capacity utilization rate of independent electric arc furnace mills may continue to decline slightly next week. Further contact us for market operation analysis of electric arc furnaces.