Last week, the national scrap steel market was mixed, the first day after the holiday, the market was strong, mainly in the northern region, and then from the rise to the fall, the southern market also followed the fall, the post-holiday replenishment lasted for a short time, and then the market entered a state of mixed gains, as a whole, the price adjustment operation was less, and most of the steel mills had a wait-and-see attitude towards scrap procurement. Last week, the Lantern Festival did not pass, most of the scrap steel sites are still closed, although there are successive openings, but the procurement of raw materials is limited, most of the employees have not returned to work, logistics has not yet recovered, and the market is at a low level. In the first week after the holiday, scrap steel consumption is still dominated by the production of long-process steel mills, and due to the general lack of arrivals, inventories continue to decline, and the decline is narrower than that in the festival. Judging from the current data, the scrap steel inventory of the current 300 steel mills fell by 143 during the Spring Festival (pre-holiday inventory peak - Lantern Festival).930,000 tons, a decrease of 2003%, which is wider than the decline in the same period of the lunar calendar last year. Due to the poor profitability of steel mills in the first three quarters of 2023, resulting in the scrap site on the verge of profit and loss for a long time, although the fourth quarter has improved, most manufacturers have reduced market expectations for 2024, the level of storage has declined, and the state of fast in and out is generally maintained.
Steel mills: As of February 21, there were 87 independent electric arc furnace steel mills, with an average operating rate of 792%, up 125%, down 56. month-on-month31%;The capacity utilization rate is 410%, up 1 week-on-week39%, down 50. month-on-month64%。According to the start of our post-holiday polymodulation electric furnace plant, most of the electric furnace plant is still scheduled to resume production around the Lantern Festival, and the operating rate and capacity utilization rate of the electric furnace last week rebounded slowly, and it is expected that the data will usher in a significant increase next week.
Market: As of February 21, MySteel has surveyed 584 scrap steel processing access enterprises, of which 21 are unprocessed raw materials in the social inventory of scrap processing access enterprises (except for steel mill scrap companies).720,000 tons, 73 finished products have been processed480,000 tons, a total of 95200,000 tons, a slight decrease from last week. At present, the social inventory is still in a slight decline stage, maintaining a low level in the past two years, the site maintains a fast-in and fast-out operation, and the view of the later stage is pessimistic, and it is difficult to have a large rebound in the short term.
Regarding the scrap inventory and related arrivals of steel mills last week, our network also made research statistics:
As of February 22, the total scrap inventory of my 300 steel mills was 57560,000 tons, a decrease of 52 from last week970,000 tons, down 843%;Turnaround days 103 days, a decrease of 04 days; The total number of daily arrivals is 3220,000 tons, an increase of 28 from last week06%;The total daily consumption is 39440,000 tons, an increase of 6 from last week51%。
Last week, steel mill scrap inventories continued to decline, and the decline was narrower than that in the quarter. On the one hand, although most of the venues have not yet returned to normal**, there are still manufacturers who maintain fast-in and fast-out operations, and the overall shipment volume has increased compared with the festival. On the other hand, last week, the operating rate and capacity utilization rate of electric furnace plants increased limitedly, scrap consumption was still running at a low level, and due to the contraction of the screw-scrap price spread, as well as the sharp decline in the finished iron products, the production efficiency of scrap steel declined, and the amount of waste used in long-process steel mills decreased slightly, and the increase in consumption was mainly brought by the resumption of production of electric furnace plants. With the resumption of production of independent electric furnace plants after the Lantern Festival, it is expected that the consumption of scrap steel will increase significantly this week. However, the current social inventory of scrap steel is at a low level in the past two years, the market is relatively tight, the output of manufacturing scrap and construction site scrap and social scrap has not recovered or increased so quickly, and the supplement of social inventory resources is very limited.
Summary: Last week, the national scrap steel market was mixed, and the post-holiday start did not come as scheduled. Scrap inventories of steel mills have been declining for two weeks, and the market is gradually recovering** but resources are low, and consumption will increase with the resumption of production of electric furnace plants. It is expected that this week's scrap steel will continue to operate in a narrow range under the long-short game.