Report Information - Report Title: Nanhua Futures Scrap Steel Industry Weekly Report - Focus on Subsequent Changes in Steel Mill Profits [1] - Report Date: August 15, 2025 [1] - Analyst: Yan Zhini [1] - Investment Consulting License Number: Z0022076 [1] Report Industry Investment Rating - Not provided in the report. Core Viewpoints - This week, the scrap steel market saw a simultaneous increase in supply and demand, with a decline in inventory and inventory-to-sales ratio, driving prices up slightly. The fundamentals of scrap steel are healthy, with strong support at the bottom, but the accumulation of steel inventory may suppress the upward movement of steel prices, and steel mill profits have also shrunk, so their willingness to raise scrap steel prices is low. It is expected that scrap steel prices will fluctuate within a range in the near future, and the spread between rebar and scrap steel may further narrow [3]. Summary by Directory Supply - This week, the scrap steel arrivals at 25 steel mills were 511,700 tons (+27,400 tons), and the average daily arrivals at Shagang were 11,800 tons (-2,700 tons) [2]. - On August 15, 2025, the scrap steel arrivals at 255 steel mills were 549,300 tons, a weekly increase of 54,841 tons; the arrivals at 132 long - process steel mills were 270,000 tons, a weekly increase of 18,891 tons; the arrivals at 89 short - process steel mills were 177,050 tons, a weekly increase of 22,800 tons [7]. Demand - This week, the daily consumption of scrap steel at 255 steel mills was 557,900 tons (+6,100 tons), with an increase in both long - and short - process steel mills [2]. - From August 7 to August 14, 2025, the daily consumption of scrap steel at 255 steel mills increased by 6,128 tons; at 132 long - process steel mills, it increased by 1,078 tons; at 89 short - process steel mills, it increased by 7,700 tons [8]. Inventory - The inventory at national processing bases decreased slightly, while the arrivals at steel mills increased. This may be due to the increase in the fear of price drops among bases after the decline in the futures market in the second half of the week, leading to the release of goods [2]. - This week, the scrap steel inventory at steel mills decreased. On August 14, 2025, the scrap steel inventory at 255 steel mills was 4,532,800 tons, a weekly decrease of 122,180 tons; at 132 long - process steel mills, it was 2,187,450 tons, a weekly decrease of 74,080 tons; at 89 short - process steel mills, it was 1,236,850 tons, a weekly decrease of 53,200 tons [2][8]. - The scrap steel social inventory decreased across the country. On August 15, 2025, the national scrap steel social inventory was 416,350 tons, a weekly decrease of 19,320 tons [9]. Price and Spread - The national Fubao comprehensive price index of scrap steel increased slightly. On August 14, 2025, the national non - tax - included scrap steel price index was 2,258.2 yuan/ton, a weekly increase of 12 yuan/ton [3]. - This week, the iron - scrap spread slightly increased, and the rebar - scrap spread significantly decreased, indicating that the cost - effectiveness of scrap steel compared to hot metal has recovered, but from a profit perspective, the cost - effectiveness of adding scrap steel has decreased, and the profits of electric arc furnaces have shrunk [2]. - On August 15, 2025, the iron - scrap spread was - 111 yuan/ton, a weekly decrease of 6 yuan/ton; the rebar - scrap spread in East China (including tax) was 769 yuan/ton, a weekly decrease of 60 yuan/ton [9]. Steel Mill Profits - This week, the profits of both long - and short - process steel mills shrank. The profits of long - process large - scale steel products still ranged from 100 to 200 yuan. The profits of short - process steel mills shrank in many regions, with only an increase in North China. Among electric arc furnaces, there were still off - peak electricity profits in Hebei and Sichuan, while there were no off - peak electricity profits in Fujian, Guangdong, Hubei, and Jiangsu, but the decline was not significant, not reaching the level of significant production cuts in electric arc furnaces [2].