EAF steel: scrap steel rebounded as scheduled,  epidemic dragged down steel demand

This week, China's construction steel market experienced a narrow range of shocks and was still in an atmosphere of buying up rather than buying down. Manufacturers mainly recovers funds through shipment, while the downstream procurement demand is insufficient. In hard-hit areas such as Guangdong, many construction sites have been shut down, affecting demand to some extent. Graphite electrode is selected as the conductor for electric furnace steelmaking. As of Nov. 11, China's rebar average price was 3,823 yuan, 16 yuan higher than last weekend.

This week, China's scrap steel price rebounded from a super decline. Affected by the recent contraction of suppliers and the rebound of the epidemic, the arrival volume of domestic steel plants' scrap steel continued to decrease. The leading steel plants in East China were forced to continuously raise prices by 200 yuan, while steel plants in other regions raised prices by about 50 yuan on average. As the price difference of scrap rebar narrowed again, the loss of the EAF steel plant has further expanded this week. In addition, the sales of iron and steel products continue to be under pressure, the enthusiasm for production of EAF steel plants has weakened, and more enterprises in the central and western regions have stopped production for maintenance. According to statistics, this week the utilization rate of EAF steel capacity of 135 steel plants in China was 42.92%, down 1.99% from last week. The EAF steel output was 240,700 tons/day, ending four consecutive weeks of growth.

At present, the epidemic situation in Guangdong and other places is still on the rise. In addition, under the pressure of the sharp decrease of demand in winter in northern steel plants and the increase of price difference in the south, China's steel market price is expected to weaken in the shock next week, and the scrap iron price will again exceed the cost of molten iron. The driving force for further growth is also weakening. The scrap price is expected to fluctuate slightly and the EAF steel output will be relatively stable next week. For more future forecasts of scrap market,  welcome to consult us.