【EAF Steel】Better Market Sentiment and Early Resumption of Production

Starting from February 7, some independent electric furnace steel mills in East China and Southwest China began resuming production, slightly earlier than last year (according to the lunar calendar). Some electric furnace steel mills in Sichuan even resumed steel deliveries as early as February 4.

In terms of profitability, the average profit of electric furnace steel mills (flat electricity) is still near breakeven, with little improvement compared to the same period last year. Only a few steel mills are profitable, but the market sentiment is indeed better than the same time last year.

Graphite electrodes are essential in electric arc furnaces, used to create high-temperature arcs for melting metals. Their conductivity, heat resistance, and durability make them vital for steel and aluminum production.

Firstly, since last year, China's domestic steel market has been in a low inventory state. As of this week, the national construction steel inventory is around 5.6 million tons, down about 1.3 million tons from the same time last year, which has eased the sales pressure on steel mills. Particularly after the reduction of northern steel shipments to the south, this has given southern electric furnace steel mills some breathing space.

Secondly, in the past two months, domestic real estate data has continuously improved, and investment in infrastructure has been notably better than the same period last year, injecting some confidence into the market. Even though the steel market fundamentals may weaken again due to the early resumption of electric furnace production, for electric furnace steel mills with low raw material inventory and good at "short, flat, and quick" operations, there will not be too much pressure, and they will directly act on it!

Feel free to contact us anytime for more information about the EAF steel market. Our team is dedicated to providing you with in-depth insights and customized assistance based on your needs. Whether you have questions about product specifications, market trends, or pricing, we are here to help.