Report Industry Investment Rating - No relevant content provided Core Viewpoints of the Report - In September, the overall market will maintain a weak oscillation. Although downstream demand is expected to improve marginally and inventory is likely to decline, production will also increase. As the apparent demand is unlikely to meet the market's optimistic expectations, there is a significant risk that the high expectations will not be fulfilled. It is recommended to engage in short - term trading and sell high in the unilateral strategy, and consider short - selling the spread between hot - rolled coil and rebar for the 10 - contract in the arbitrage strategy [81][92]. Summary According to the Table of Contents 1. Main Views - **Supply**: Due to good production profits, the overall steel output has changed little, remaining volatile in the past quarter. The output of the five major varieties has fluctuated between 8.5 million and 9 million tons per week, and the rebar output has remained around 2.2 million tons per week, while the hot - rolled coil output has recently declined. With the arrival of the consumption peak season and the end of the parade, the overall output is expected to rise [8][81]. - **Demand**: The apparent demand for rebar has increased month - on - month, while that for hot - rolled coil has decreased. The overall apparent demand for the five major varieties has rebounded. Recently, the apparent demand for plates has declined from a high level. Seasonally, with the end of the summer heat, the apparent demand is expected to recover, but it is still at a five - year low, similar to the same period last year. It is expected that there will be no significant year - on - year increase in demand [8][81]. - **Inventory**: The steel mill inventory has decreased briefly, while the social inventory has been rising. The inventory is being transferred from steel mills to downstream, indicating that steel mills are not optimistic about the future market. The total inventory of the five major varieties has rebounded and is close to last year's level. Currently, the inventory pressure is not high, and it is expected to continue to decline during the consumption peak season. However, inventory is not the main contradiction but a factor that triggers a negative feedback loop in prices [8][81]. - **Price and Market**: The previous price increase was mainly due to "anti - involution" trading, and the market is a game between strong expectations and weak reality. According to past rules, the demand expectations for the consumption peak season have been priced in the early - August prices. Although demand will improve in September, it still lags far behind the optimistic expectations at the previous price peak [8][81]. 2. Review of the Rebar and Hot - Rolled Coil Futures and Spot Markets - In the past month, the prices of rebar and hot - rolled coil have generally declined, with the decline of rebar being more significant and that of hot - rolled coil being smaller. The rebar basis has widened, mainly because the decline of futures prices is greater than that of spot prices. The hot - rolled coil basis has also widened slightly, indicating that hot - rolled coil has been relatively stronger than rebar recently. The spread between near - and far - month contracts of rebar has been falling and has entered a range where it is possible to go long on the spread between the 10 - and 01 - contracts. The spread between near - and far - month contracts of hot - rolled coil has remained fluctuating around zero. The spread of the 10 - contract between hot - rolled coil and rebar is high and may correct significantly in the future [12][15][23]. 3. Supply and Demand Analysis of Steel - **Supply**: The decline in production in July was mainly due to the off - season of downstream consumption in summer, when steel mills actively reduced production. The crude steel output has gradually recovered to a high level in the same period. The weekly output of steel has increased slightly month - on - month. The output of rebar and hot - rolled coil has both increased recently, and the total output of the five major varieties has also risen. After the end of the parade - related production restrictions, the production recovery is expected to accelerate. The output of independent electric arc furnaces remains relatively high, with the output of independent electric arc furnace rebar at a multi - year peak, and the operating rate and capacity utilization rate both remaining high. The iron - water output is basically flat and remains at a relatively high level. After the end of the parade - related restrictions, the iron - water output is expected to continue to increase [41][49][66]. - **Demand**: The apparent demand for building materials has improved month - on - month, while the demand for medium - thick plates has declined from a high level. The apparent demand for rebar and hot - rolled coil has both improved, but the total demand for rebar and the five major steel varieties is still at a five - year low. In July, steel exports rebounded month - on - month, and the export volume of steel billets increased significantly. The increase in exports is expected to be mainly driven by the high - speed growth of steel billet exports, and the trade war has not affected steel and steel billet exports [55][57][58]. - **Profit**: The decline in gross profit is mainly because the recent increase in the spot prices of coking coal and coke is significantly greater than that of rebar. After a brief profit recovery, the profits of short - process steel mills in various regions have declined [62][68]. - **Inventory**: The inventory of major steel products in steel mills has decreased month - on - month, with the rebar inventory in steel mills starting to decline and the inventory of other varieties continuing to increase, resulting in a slight decrease in the total steel mill inventory. The social inventory of major steel products has been increasing continuously, and the social inventory of hot - rolled coil has been rising rapidly. The rebar inventory and the total inventory of the five major varieties have increased rapidly, while the overall inventory of upstream steel mills has declined, indicating that upstream steel mills are not optimistic about future prices and are transferring inventory to downstream [70][73][75]. 4. Market Outlook and Investment Opportunity Analysis - **Market Outlook**: The Langer Steel PMI index shows short - term pressure. The price peak usually precedes the PMI index peak. The PMI index reflects industry demand and is similar to the trend of social inventory. From August to September each year, the PMI index reaches its peak and then declines, indicating that the market is actually weak when downstream consumption improves. Currently, the index has been at 49.8 for two consecutive months and below the boom - bust line for four consecutive months. Historically, the probability of price decline is high in May, August, and September, and the probability of price increase is high in December, January, and July [82][84][88]. - **Investment Opportunities**: In the unilateral strategy, it is recommended to engage in short - term trading and sell high. In the arbitrage strategy, short - selling the spread between hot - rolled coil and rebar for the 10 - contract can be considered. The ratio of rebar to iron ore is currently low and may rise in the future, presenting a good long - position opportunity. The ratio of rebar to coke has declined significantly and may continue to decline, but in the short term, there may be a rebound in the rebar/coke ratio [38][92].

Core Viewpoint - The steel market is experiencing diverse price trends across different varieties and regions, indicating a complex landscape where some players are thriving while others are struggling [1] Group 1: Market Performance - The medium plate market remains stable, with most regions showing no price movement, reflecting a balanced supply and demand situation [4] - In contrast, the hot-rolled coil market is seeing significant price increases in Chongqing, with a daily rise of 40 yuan/ton due to resource shortages [5] - The rebar market shows a clear north-south price disparity, with cities like Beijing and Chongqing experiencing price increases, while Guangzhou and Jinan see slight declines due to low-priced resources [6][8] Group 2: Market Signals - Resource shortages act as a catalyst for price increases, as evidenced by the surge in hot-rolled coil prices in Chongqing [6] - The strength of the futures market is boosting the spot market, particularly influencing the rise in Shanghai rebar prices [6] - The influx of low-priced resources is directly linked to the price declines in rebar in Jinan and Guangzhou [8] Group 3: Operational Recommendations - Steel traders face limited operational space, with opportunities primarily in markets like Chongqing where supply is tight [9] - End-users are advised to adopt a demand-driven purchasing strategy, avoiding panic buying or expectations of significant price drops in the short term [9]

1. Report Industry Investment Rating No relevant content provided. 2. Core Viewpoints of the Report - The main contract price of rebar oscillated upwards with a daily increase of 2.32%, and the volume and open interest expanded. With both supply and demand increasing, the fundamentals of rebar have not improved substantially. The relatively positive factor is the low inventory level, with few real - world contradictions. Coupled with the strong cost support from raw materials, it is expected that the rebar price will continue to oscillate at a high level. Attention should be paid to domestic policies [4]. - The main contract price of hot - rolled coil strengthened, with a daily increase of 1.98%, and the volume and open interest expanded. Currently, both the supply and demand of hot - rolled coil have weakened, and the fundamentals have weakened again. There is a slight inventory build - up, but the overall contradiction is not significant. The strong raw materials boost market sentiment. It is expected that the hot - rolled coil price will maintain a high - level oscillating trend. Attention should be paid to overseas risks [4]. - The main contract price of iron ore oscillated weakly, with a daily decline of 1.11%. The volume increased while the open interest decreased. Currently, market sentiment has stabilized. Coupled with the suppression of high coking coal prices, the iron ore price has fallen from its high level. However, with supply being weak and demand being strong, the fundamentals of iron ore are still acceptable, and the short - term downward space is limited. It is expected that the iron ore price will continue to oscillate and consolidate at a high level. Attention should be paid to the shipping situation of miners [4]. 3. Summary by Relevant Catalogs 3.1 Industry Dynamics - In the first half of 2025, the national general public budget expenditure was 1.41271 trillion yuan, a year - on - year increase of 3.4%. The expenditure on social security and employment increased by 9.2% year - on - year, science and technology expenditure increased by 9.1% year - on - year, education expenditure increased by 5.9% year - on - year, and health expenditure increased by 4.3% year - on - year. The national general public budget revenue was 1.15566 trillion yuan, a year - on - year decrease of 0.3%. National tax revenue was 929.15 billion yuan, a decrease of 1.2%, and non - tax revenue was 226.51 billion yuan, an increase of 3.7% [6]. - The National Development and Reform Commission is promoting large - scale equipment renewal and consumer goods trade - ins. The "Two New" policy system and working mechanism are continuously improving. The State Council has issued an action plan, and the National Development and Reform Commission has issued support measures and expansion policies, and established an inter - ministerial joint meeting system [7]. - In the second quarter of 2025, FMG's iron ore production was 5.44 million tons, a year - on - year increase of 7%. The annual production in fiscal year 2025 reached 201 million tons, a year - on - year increase of 6%. The shipping volume in the second quarter was 5.52 million tons, a year - on - year increase of 3%. The annual shipping volume in fiscal year 2025 reached 198 million tons, a year - on - year increase of 4%. The shipping target for fiscal year 2026 is 195 - 205 million tons [8]. 3.2 Spot Market - The spot prices of rebar in Shanghai, Tianjin, and the national average were 3,400 yuan, 3,360 yuan, and 3,463 yuan respectively; the spot prices of hot - rolled coil in Shanghai, Tianjin, and the national average were 3,470 yuan, 3,440 yuan, and 3,514 yuan respectively. The price of Tangshan billet was 3,130 yuan, and the price of Zhangjiagang heavy scrap was 2,140 yuan. The spread between hot - rolled coil and rebar was 70 yuan, and the spread between rebar and scrap was 1,260 yuan [9]. - The price of 61.5% PB powder at Shandong ports was 784 yuan, and the price of Tangshan iron concentrate was 748 yuan. The ocean freight from Australia was 10.40 yuan, and from Brazil was 24.18 yuan. The SGX swap price (current month) was 100.01 yuan, and the Platts Index (CFR, 62%) was 104.50 yuan [9]. 3.3 Futures Market | Variety | Active Contract | Closing Price | Increase/Decrease (%) | Highest Price | Lowest Price | Volume | Volume Difference | Open Interest | Open Interest Difference | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | Rebar | - | 3,356 | 2.32 | 3,358 | 3,288 | 2,878,137 | 344,884 | 1,998,652 | 92,300 | | Hot - rolled Coil | - | 3,507 | 1.98 | 3,508 | 3,452 | 995,111 | 142,246 | 1,554,563 | 46,781 | | Iron Ore | - | 802.5 | - 1.11 | 815.5 | 790.0 | 533,058 | 134,404 | 528,991 | - 33,844 | [11] 3.4 Relevant Charts - The report presents various charts related to steel and iron ore inventories, including weekly changes in rebar and hot - rolled coil inventories, total inventories of rebar and hot - rolled coil (steel mills + social inventory), national 45 - port iron ore inventories, 247 - steel mill iron ore inventories, and domestic mine iron concentrate inventories [13][14][16]. - Charts on steel mill production conditions are also included, such as the blast furnace operating rate and capacity utilization rate of 247 sample steel mills, the proportion of profitable steel mills among 247 steel mills, the operating rate of 87 independent electric furnaces, and the profit and loss situation of 75 building material independent electric arc furnace steel mills [27][29][32]. 3.5后市研判 - Rebar: Supply has increased with a weekly output increase of 2.90 tons, and there is room for further increase. Demand has improved with a weekly apparent demand increase of 10.41 tons, mainly due to speculative demand. However, both supply and demand are still at low levels in recent years, and the sustainability of demand improvement is weak. With low inventory and strong raw material cost support, the rebar price is expected to continue to operate at a high level. Attention should be paid to policy changes [35]. - Hot - rolled Coil: Both supply and demand have weakened. The weekly output has decreased by 3.65 tons, and the weekly apparent demand has decreased by 8.55 tons. Although high - frequency trading is good due to speculative demand, and downstream cold - rolled production is high, the narrowing internal - external price spread and potential tariff disturbances may lead to overseas demand risks. The price is expected to maintain a high - level oscillation. Attention should be paid to overseas risks [36]. - Iron Ore: The terminal consumption of iron ore has declined slightly, but the demand is still resilient due to the good profitability of steel mills. The arrival at domestic ports has decreased, and the short - term overseas supply is low. However, the shipping of overseas miners is increasing, and the domestic supply is also stable with a slight increase. With stable market sentiment and the suppression of high coking coal prices, the iron ore price has fallen from its high level. It is expected to continue to oscillate and consolidate at a high level. Attention should be paid to the shipping situation of miners [37].

Group 1 - The domestic steel price index slightly decreased during the week of June 23-27, with both long and flat steel price indices declining, and the drop in long steel prices being greater than that of flat steel prices [1] - The China Steel Price Index (CSPI) was 89.51 points, down 0.59 points week-on-week, a decrease of 0.65%; it fell by 1.29 points compared to the end of last month, a decline of 1.42%; and it decreased by 7.96 points since the end of last year, a drop of 8.17% [1] - The long steel price index was 91.27 points, down 0.73 points week-on-week, a decrease of 0.79%; it fell by 1.03 points compared to the end of last month, a decline of 1.12%; and it decreased by 8.95 points since the end of last year, a drop of 8.93% [1] Group 2 - All six major regions in China saw a week-on-week decline in steel price indices, with the Southwest region experiencing the largest drop and the North China and Northeast regions the smallest [2] - The North China steel price index was 88.50 points, down 0.49 points week-on-week, a decrease of 0.55%; it also fell by 13.76 points year-on-year, a decline of 13.46% [2] - The Southwest region's steel price index was 90.08 points, down 0.79 points week-on-week, a decrease of 0.87%; it decreased by 12.50 points year-on-year, a drop of 12.19% [2] Group 3 - All eight major steel product prices decreased compared to the end of last month, with the largest drop in cold-rolled sheets and the smallest in angle steel [3] - The price of 6mm high-line steel was 3243 CNY/ton, down 32 CNY/ton, a decrease of 0.98%; the price of 16mm rebar was 3051 CNY/ton, down 31 CNY/ton, a decline of 1.01% [3] - The price of 1mm cold-rolled sheets was 3721 CNY/ton, down 95 CNY/ton, a decrease of 2.49% [3] Group 4 - In May, the average import price of iron ore was 96.24 USD/ton, down 1.86 USD/ton, a decline of 1.90%; it also fell by 9.56 USD/ton year-on-year, a drop of 9.04% [4] - The domestic iron concentrate price was 843 CNY/ton, down 45 CNY/ton, a decrease of 5.07%; it decreased by 100 CNY/ton year-on-year, a drop of 10.60% [4] - Coking coal price was 1189 CNY/ton, down 89 CNY/ton, a decline of 6.96%; it fell by 731 CNY/ton year-on-year, a drop of 38.08% [4] Group 5 - In June, the CRU international steel price index was 188.1 points, down 7.0 points, a decline of 3.6%; it increased by 7.5 points since the end of last year, a rise of 4.2% [5] - The CRU long steel price index was 194.2 points, down 1.4 points, a decrease of 0.7%; it fell by 10.9 points year-on-year, a drop of 5.3% [5] - The North American steel price index was 235.1 points, down 9.9 points, a decline of 4.0%; it increased by 9.3 points year-on-year, a rise of 4.1% [5] Group 6 - The China steel price index fell below 90 points, influenced by seasonal demand fluctuations due to weather conditions affecting construction progress [6] - Supply slightly increased in the latest reporting period, while raw material prices decreased, reducing support for steel prices [6] - Overall, steel prices are expected to remain weak and fluctuate in the short term due to seasonal effects [6]

Group 1 - The core viewpoint of the article suggests that the steel market in the second half of the year will be influenced by multiple factors, with prices expected to initially decline before rising [1] - Domestic demand for steel is heavily reliant on policy support, with a projected decline in demand for construction steel, although urban renewal may offset some of the decrease [1] - Infrastructure steel demand may improve on a month-on-month basis, but lacks significant growth potential [1] Group 2 - The manufacturing sector is showing weakness in certain areas, requiring support from "two new" policies [1] - Direct exports are expected to remain high, but are unlikely to drive steel prices significantly [1] - Supply-side production is anticipated to fluctuate slightly, with ongoing reductions in crude steel production causing disruptions [1] Group 3 - Iron ore supply pressure is easing, with a projected increase of approximately 13.7 million tons in global iron ore shipments by 2025, while annual foreign ore arrivals are expected to decrease by 15 to 20 million tons year-on-year [1] - Under optimistic assumptions, average molten iron production is expected to be 2.39 million tons per day in Q3, decreasing to 2.28 million tons per day in Q4 [1] - Under pessimistic assumptions, crude steel production may be reduced by 10 to 20 million tons in Q4, leading to significant inventory pressure [1] Group 4 - Recommendations suggest seizing rebound opportunities in undervalued areas while paying attention to the downward pressure from crude steel reduction policies [1] - Risk factors include potential negative impacts from tariffs on exports and strict enforcement of crude steel reduction policies [1] - The demand outlook for coke is not optimistic, with no significant downward expectations for molten iron in the short term, but long-term demand for finished products remains under pressure [1] Group 5 - Coking coal mines are still profitable, but supply pressures persist, with short-term demand for molten iron supported by basic needs [1] - High levels of imports are stable, but price pressures exist, necessitating attention to coal mine safety regulations [1] - The cost of silicon manganese continues to exert pressure, with production control becoming increasingly difficult [1] Group 6 - The difficulty of destocking silicon iron is increasing, with challenges in inventory digestion as steel production declines [1] - The destocking process may accelerate during the peak season, with potential for valuation recovery, although the extent of rebound is limited [1] - Attention is required on production control measures from manufacturers [1]

Group 1: Steel Price Trends - Since April, steel prices have been operating at low levels, with a focus on fundamental logic as the "tariff war" with the U.S. eases, but prices remain under pressure due to strong supply and weak demand [1] - The steel price outlook is expected to be neutral to slightly bearish in the short to medium term, primarily due to the ongoing supply-demand imbalance [7] Group 2: Real Estate Market Impact - The real estate market shows signs of improvement, but its support for construction steel prices is limited, with national real estate development investment in the first quarter at approximately 1.99 trillion yuan, down 9.9% year-on-year [2] - New housing starts and completions have seen significant declines, with new starts down 24.4% and completions down 14.3% year-on-year, indicating ongoing pressure on steel prices from the construction sector [3] Group 3: Export Dynamics - In March, China exported 10.46 million tons of steel, with cumulative exports from January to March at 27.43 million tons, a year-on-year increase of 6.3%, while imports decreased by 11.3% [4] - The price advantage of Chinese steel and declining overseas crude steel production are contributing to continued export growth, although future exports may face pressure from rising international trade protectionism [4] Group 4: Production and Profitability - In March, China's crude steel production reached 92.84 million tons, a year-on-year increase of 4.6%, with a high operating rate of 84.33% among steel mills, indicating strong production activity despite low prices [5] - Steel mills are experiencing improved profitability, which reduces the likelihood of voluntary production cuts, although some mills in Xinjiang have announced production reductions [5][6] Group 5: Product-Specific Trends - In March, rebar production was 18.61 million tons, up 5.6% year-on-year, while the production of medium and heavy wide steel plates increased by 8.5% [7] - The production adjustments between rebar and hot-rolled coils are expected to become more flexible in the coming months, influenced by export conditions [7]