【EAF Operation Rate】National Statistics for September 2023

The average operation rate of 87 independent electric arc furnace (EAF) steel plants in China is 74.84% in September 2023. This represents an increase of 1.44 percentage points compared to the previous month and a substantial increase of 13.17 percentage points compared to the same period last year. Notably, the Southern and Eastern regions witnessed minor increases, while the Northeast region showed a significant rise, with the remaining regions remaining stable, , and the specific parameters for Ultra High Power Graphite Electrodes in Electric Arc Furnace (EAF) Steel Production. The average capacity utilization rate of these 87 independent EAF steel plants is 53.60%, marking an increase of 0.84 percentage points month-on-month and a 1.51 percentage point year-on-year increase. The Southern region saw a slight decrease, and the Central region experienced a minor decline, while the Northeast, Northern, Eastern, Northwestern, and Southwestern regions saw marginal increases. 

Based on the data for this week, the operation rate and capacity utilization rate of independent electric arc furnaces in China have increased slightly. The main reasons for the increase in the operation rate this week include the resumption of production at a steel plant in Fujian, Eastern China, on the 27th, the resumption of production at a steel plant in Liaoning, Northeast China, on the 26th, and another steel plant resuming production on the 5th, albeit with unsaturated production, maintaining a 6-hour production status. Additionally, an electric furnace plant in Guangxi, Southern China, resumed production on the 31st, with daily production maintained at around 10,000 tons. Furthermore, another steel plant in Guangxi began equipment upgrades and maintenance at the beginning of this month. In terms of steel plant profitability, there has been a reduction in the number of loss-making manufacturers, an increase in the number of break-even manufacturers, and some improvement in profit levels. Some steel plants in the Southwestern, Eastern, and Central regions have reported relatively sufficient scrap steel supply, resulting in a slight increase in production. At the same time, some steel plants have increased their September production plans due to the stoppage of production by other steel plants in order to meet market demand. As we enter September, the traditional peak season for consumption has arrived, and with the release of macroeconomic positive news, although actual demand remains weak and has not significantly improved, there has been no noticeable improvement in steel plant profitability. Overall, steel plants are showing moderate enthusiasm for production. If finished product prices rise slightly and steel plants have stronger expectations for the future market, there may be a possibility of increased production.

In summary, it is expected that the operation rate and capacity utilization rate of independent electric arc furnace plants may experience a slight increase next week.  For more information on the carbon market, feel free to inquire with us.

 Data Source: Oilchem