1. Report Industry Investment Rating No relevant content provided. 2. Core Views of the Report - Recently, rebar and hot-rolled coils have maintained a volatile and slightly stronger trend, with price increases mainly driven by rising coking coal and coke prices. There may be opportunities to go long on the spread between near and far contracts of rebar, and it is worth trying to short the spread between hot-rolled coils and rebar in the short term. The ratio of rebar to iron ore is at a low level, presenting a good long - term long - opportunity, while the ratio of rebar to coke has entered a downward cycle [8][45]. - The market is a game between strong expectations and weak reality, with "anti - involution" trading supporting futures prices. Seasonal improvement in demand is expected to be reflected in prices in advance [8]. - With the arrival of the consumption peak season, overall steel production is likely to increase slightly, and inventory is expected to continue to decline [8][94]. 3. Summary According to the Table of Contents 3.1 Main Views - Supply: Due to good production profits, overall steel production has remained stable in the past quarter, with the output of five major varieties fluctuating between 850 - 900 million tons per week, rebar output at around 220 million tons per week, and hot - rolled coil output recently decreasing. Production is expected to rise slightly in the peak season [8][94]. - Demand: The apparent demand for rebar has increased month - on - month, while that for hot - rolled coils has decreased. The overall apparent demand for the five major varieties has continued to decline. Apparent demand is expected to recover after the end of the summer heat, but the increase will be limited [8][94]. - Inventory: Steel mill inventories are decreasing. Although social inventories rebounded last week, the total inventory of the five major varieties has increased but remains significantly lower than last year. Currently, inventory pressure is low, and inventory may continue to decline in the peak season [8][94]. - Futures price support: "Anti - involution" trading supports futures prices, and the market is a game between strong expectations and weak reality. Seasonal demand improvement is expected to be reflected in prices in advance [8][94]. - Price trends and trading opportunities: Recently, rebar and hot - rolled coils have been volatile and slightly stronger, driven by coking coal and coke prices. There may be opportunities to go long on the spread between near and far contracts of rebar, while there are no trading opportunities for hot - rolled coil spreads for now. It is worth trying to short the spread between hot - rolled coils and rebar in the short term. The ratio of rebar to iron ore is at a low level with significant upside potential, and the ratio of rebar to coke has entered a downward cycle [8][45]. - Trading strategy: Treat rebar and hot - rolled coils with a wide - range volatility mindset, avoid chasing highs or selling lows, and try high - selling and low - buying operations with firm profit - taking and slightly larger stop - losses. Price movements will follow coking coal and coke, but with smaller price changes [8][94]. 3.2 Review of the Rebar and Hot - Rolled Coil Futures and Spot Markets - Spot prices: Recently, rebar was generally weak, with prices in Shanghai and Guangzhou falling. Hot - rolled coils were generally strong, with prices in Shanghai, Guangzhou, and Tianjin rising by 10 - 40 yuan [12][13]. - Futures prices: Rebar futures prices rose and then fell, with the basis narrowing. Hot - rolled coil prices also rose and then fell, approaching flat price. The basis of the main contracts of rebar and hot - rolled coils generally showed a narrowing trend [15][17][18]. - Spreads: The spread between near and far contracts of rebar has been falling, and there may be long - spread opportunities. The inter - contract spread of hot - rolled coils has been narrowly fluctuating, with no trading opportunities. The spread between hot - rolled coils and rebar in the 10 - contract has rapidly expanded, deviating from the normal level, and shorting this spread is worth trying [21][23][26]. - Other spreads: The spreads between different regions and varieties have generally widened, indicating improved downstream processing profits [36][38]. 3.3 Analysis of Steel Supply and Demand - Supply: Recent crude steel production has significantly declined, mainly due to previous low prices and poor expectations. Steel weekly production is higher than last year, and the output of independent electric arc furnaces remains relatively high. Iron - water production has also decreased slightly [47][49][56]. - Demand: The apparent demand for building materials has improved month - on - month, while that for hot - rolled coils has weakened. Steel exports rebounded in July, with the growth rate accelerating, mainly driven by high - speed growth in billet exports [62][65][67]. - Profit: The decline in gross profit is mainly due to the recent significant increase in coking coal and coke prices compared to rebar. Currently, the valley - electricity profit in all regions has improved significantly, and only the southwest region has good flat - electricity profit. Profit is expected to continue to improve in the third quarter, so short - term electric arc furnace output is not expected to decline significantly [70][79]. - Inventory: Steel mill inventories of major varieties are increasing but still in a downward trend. Social inventories are continuously increasing, with hot - rolled coil inventories rebounding rapidly. The total inventory of major varieties has increased month - on - month but is still significantly lower than last year [80][83][86]. 3.4 Market Outlook and Investment Opportunity Analysis - Market outlook: "Anti - involution" continues to support futures prices, and seasonal improvement in demand may be reflected in prices in advance. The market will continue the game between strong expectations and weak reality [93]. - Investment opportunities: There may be opportunities to go long on the spread between near and far contracts of rebar, and it is worth trying to short the spread between hot - rolled coils and rebar in the short term. The ratio of rebar to iron ore is at a low level, presenting a good long - term long - opportunity, while the ratio of rebar to coke has entered a downward cycle [8][45].