【EAF Steel】Market Expectations Strong, 

Reality Weak, EAF Profit Slightly Recovered

Market Overview:

This week, the domestic construction steel market saw a slight increase with ongoing fluctuations. The positive impact of new real estate policies continued, but actual transactions remained lukewarm. Many traders focused on reducing inventory, limiting the momentum for sustained price increases. As of May 23, the average price of rebar in China was 3,799 RMB, up 68 RMB from last weekend.

Raw Materials:

Scrap steel prices slightly increased this week. The average purchase price of scrap steel by EAF steel mills rose by 46 RMB to 2,502 RMB (excluding tax) compared to last weekend. Specifications Guide for Graphite Electrodes for Electric Arc Furnaces (EAF). There was a sentiment of holding back sales and maintaining prices at scrap yards, leading to a decline in scrap steel arrivals and inventory at steel mills.

Production and Profitability:

EAF steel mill profits showed slight improvement this week, with some furnaces resuming production in regions like Guangxi and Fujian. As of May 23, the capacity utilization rate of 135 EAF steel mills nationwide was 58.98%, an increase of 1.23% from the previous week. Daily EAF steel output reached 362,800 tons.

Market Outlook:

Currently, the steel market transactions have not shown significant improvement. The strengthening of prices is primarily driven by favorable macroeconomic expectations. However, with the continuous rise in steel production, the room for price increases will be constrained. It is anticipated that next week, EAF steel production and profits will remain stable as the market awaits new driving forces. For more information about the EAF steel market, feel free to contact us.