Investment Rating - The report maintains a "Buy" rating for the steel industry, indicating a positive outlook as the industry enters its traditional peak season with expected improvements in supply and demand dynamics [2]. Core Insights - The supply side shows structural differences, with a notable decline in daily iron water output from 247 sample enterprises due to policy impacts on blast furnace companies. However, electric arc furnace companies are resuming production, leading to an increase in the output of five major steel products to 8.2097 million tons. Demand is driven by construction steel, with average daily transaction volumes nearing 100,000 tons, close to the 2025 annual average of 101.5 million tons. Post "Two Sessions," steel companies are expected to have some recovery motivation, although current profit levels remain low, limiting significant production increases. Future output of five major products is projected to rise by 4-5% in the coming weeks, while demand is expected to rebound by around 7% [3][4]. Industry Data Tracking Production Data - As of March 13, the steel (Shenwan) index closed at 2972.26 points, down 1.67% for the week. The total market capitalization of the steel sector is approximately 1,270.203 billion yuan, with a circulating market capitalization of about 1,134.568 billion yuan [6][4]. Consumption Volume of Major Steel Products - The total consumption of five major steel products reached 7.9808 million tons, reflecting a week-on-week increase of 106.73 thousand tons. The apparent consumption of rebar, wire rod, hot-rolled, cold-rolled, and medium plate changed by +785.8 thousand tons, +89.1 thousand tons, +137.9 thousand tons, +62.4 thousand tons, and -7.9 thousand tons respectively [8][9]. Inventory Situation - The total steel inventory reached 19.7489 million tons, with a week-on-week increase of 2.289 million tons. Social inventory accounted for 1.2328 million tons, up 2.015 million tons week-on-week, while steel mill inventory rose to 5.5161 million tons, an increase of 0.274 million tons [8][9]. Profitability - As of March 13, the profit margins for various steel products are as follows: high furnace rebar at 64 yuan/ton, building steel (electric furnace) at -84 yuan/ton, hot-rolled coil at -9 yuan/ton, and cold-rolled coil at -160 yuan/ton. Approximately 41.13% of the sampled steel enterprises are currently profitable [8][9].

Group 1 - The steel industry is showing signs of recovery, with an increase in operating rates for coking, rebar, and wire rod production [1] - The comprehensive steel price index has increased by 4.6% month-on-month, indicating a significant rise in steel prices [1] - Infrastructure funding is abundant, and project reserves are increasing, which may lead to marginal improvements in infrastructure and support steel demand [1] Group 2 - The Steel ETF (515210) tracks the CSI Steel Index (930606), which reflects the overall performance of listed companies involved in steel production, processing, and sales [1] - The index includes companies across the steel industry supply chain, emphasizing cyclical steel manufacturing and related services [1] - Investors without stock accounts can consider the Guotai CSI Steel ETF Connect C (008190) and A (008189) [1]