【EAF Steel】Sporadic Recovery, Scrap Steel Awaits Rise

The prices of construction steel in China continued to rebound slightly this week, but end-users remained cautious. Traders focused on inventory clearance, and as of June 15th, the average price of rebar in China was CNY 3,788, an increase of CNY 71 from the previous week. In terms of raw materials, some steel mills raised prices slightly to replenish their stock. UHP graphite electrodes are mainly used in EAF STEELMAKING, learn more... The average purchase price of scrap steel (electric furnace charge) in steel mills increased by CNY 44 to CNY 2,534 compared to last week. Due to the slower rebound of scrap steel compared to iron ore, some suppliers are reluctant to sell at lower prices. As a result, steel mill arrivals have increased at a slow pace.

As steel prices gradually stabilize and losses narrow slightly, some large electric furnace steel mills in southern China (such as Jiangsu, Guangxi, and Yunnan) have resumed production as scheduled, leading to a modest rebound in electric furnace steel production. According to statistics, the capacity utilization rate of electric furnace steel in 135 steel mills in China was 36.12% this week, an increase of 0.43% from the previous week. The daily output of electric furnace steel reached 203,300 tons, ending an 11-week downward trend.

Although steel prices have rebounded recently, the latest economic data is not promising, with declines observed in both manufacturing and real estate sectors. Therefore, the current rebound in steel prices is considered an oversold bounce rather than a sign of increased demand. In terms of electric furnaces, the positive factor lies in the increased maintenance of blast furnaces in June, and some long-process steel mills adjusting their production towards higher-profit plate products. This will help alleviate the pressure on electric furnace steel mills. However, a short-term reversal is unlikely, and maintaining a production level of around 12 hours is considered satisfactory. For the latest EAF STEEL industry reports, feel free to contact us.