【EAF Steel】Weak steel market transactions, EAF profits turn negative

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【EAF Steel】Weak steel market transactions, EAF profits turn negative

This week, China's construction steel market continued to fluctuate slightly. Downstream procurement remained mainly demand-driven, traders were cautious in purchasing, and inventory destocking remained slow, thereby exerting downward pressure on prices. As of April 2, the average price of rebar in China was RMB 3,224, down RMB 12 from the end of last week.

On the raw material side, the scrap steel market remained stable with slight declines this week. As steel prices and iron ore and coke prices weakened, some steel mills lowered their scrap procurement prices. Some suppliers accelerated shipments, and scrap arrivals at steel mills continued to improve. This week, losses at EAF steel mills slightly widened but remained within a neutral range, while EAF steel output continued to rise.

According to statistics, as of April 2, the capacity utilization rate of 135 EAF steel mills in China reached 46.34%, up 4.08% from last week, and the average daily EAF steel output increased to 304,900 tons.

Currently, demand in the steel market remains moderate, and prices are still mainly fluctuating in response to the Middle East situation, particularly affecting bulk commodities such as iron ore and coking coal, which in turn impacts the production pace of EAF steel mills. Overall, some EAF steel mills in China are operating with slight profits, but as the proportion of construction steel is expected to continue declining in 2026, sales pressure on EAF steel mills remains.

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