【EAF Steel】Output Stabilizes, When Will EAFs Counterattack?

This week, the domestic construction steel market in China has experienced narrow fluctuations in prices. The enthusiasm for inventory replenishment among end-users remains low, and businesses are generally exercising caution in their operations. Learn more about the technical specifications of ultra-high power graphite electrode products for electric arc furnace steelmaking. As of August 17th, the average price of rebar steel in China was 3693 yuan, down 11 yuan compared to the previous weekend. 

In the raw material field, the trends in the scrap steel market have shown slight differentiation this week. Some long-process steel mills have slightly adjusted their purchasing prices downward, while certain electric arc furnace (EAF) steel mills in the southern regions have started raising prices for inventory replenishment. The average purchase price of scrap steel (EAF feedstock) for steel mills has decreased by 2 yuan to 2549 yuan per ton (excluding VAT). According to statistics, as of August 17th, the capacity utilization rate of 135 EAF steel mills nationwide was 34.38%, with a slight increase of 0.23% compared to the previous period. The daily production of EAF steel stands at 203,500 tons.

The recent turmoil in the real estate market and the less-than-ideal economic data for July have contributed to the continued weakness in the demand side of the steel market. Currently, the market's hopes are pinned on the implementation of policies to stabilize crude steel production. However, despite some steel mills indicating their intention to reduce production and even conducting operations to sell iron ore inventories, there is still no clear atmosphere of production reduction. There are even predictions that the emphasis on production stabilization might be shifted to the fourth quarter.

Therefore, in the short term, EAF steel mills are not yet able to reap the benefits of the production stabilization policy, and it's likely that the market will only show signs of improvement around September. EAF steel price forecast for September, feel free to communicate with us.