WEEKLY: Good profits, low stocks push rebar output higher
The two key production indices for rebar – operational rate and capacity utilization rate – both rose by the same 1.3 percentage points on-week to 72.5% and 75.6% respectively during the survey period, according to the study.
The integrated steelmakers operating blast furnaces and the electric-arc furnace mills which Mysteel regularly monitors, each posted further improvements in their productivity, with the capacity utilization rate of the integrated mills higher by 1 percentage point week on week to 81.2% and that for the EAF mills increasing by 2.2 percentage points on week to (an albeit still fairly low) 54%, according to the study.
“The steelmakers are working quite well at present,” a Shanghai-based industry source said. “We can see this by their improving profits and the reduction in pressure they’re feeling from stock levels since March. As we’re now in the traditional peak season for steel consumption, I see the steady increases in rebar output lasting for a while.”
Last month, the average profits that the 91 integrated mills tracked by Mysteel accrued by making rebar rebounded to Yuan 322/tonne ($48/t), up by Yuan 49/t over the month, according to Mysteel’s monthly profit study released last Thursday. At the same time the profits earned by the ten re-rollers Mysteel monitors also rose by another Yuan 55/t on month to Yuan 150/t.
During the March 28-April 3 week, rebar inventories held by the 137 makers declined for a sixth consecutive week, thinning by another 186,100 tonnes or 7.5% week on week to 2.28 million tonnes, mainly due to the improvement in downstream demand starting this month, according to Mysteel’s database.
Moreover, rebar output in North China posted marked gains over the March 28-April 3 week, with the operational rate and utilization rate among mills there making rebar also posting significant increases of 1.6 percentage points and 2 percentage points week on week, the largest among all regions nationwide. Industry watchers attributed the robust result mainly to the fact that steelmakers in North China – especially in Hebei province – gradually resumed their operations after the production restrictions for winter were officially lifted from end-March, Mysteel understands.
Written by Venus Wang, wangyi@mysteel.com
Edited by Russ McCulloch, russ.mcculloch@mysteel.com
Table 1: Mysteel Rebar Production Survey by Region on April 3 (Unit: ’000 tonnes)
Table 2: Mysteel Wire Rod Production Survey by Region on April 3 (Unit: ‘000 tonnes)
Table 3: Mysteel Rebar Production Survey by Process on April 3 (Unit: ‘000 tonnes)
Table 4: Mysteel Wire Rod Production Survey by Process on April 3 (Unit: ‘000 tonnes)
Table 5: Mysteel Rebar and Wire Rod Stocks Survey by Region on April 3 (Unit: ‘000 tonnes)
Table 6: Mysteel Rebar and Wire Rod Stocks Survey by Process on April 3 (Unit: ‘000 tonnes)
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