Investment Rating - The report has shifted its near-term investment pecking order to prioritize steel over other materials, indicating a positive outlook for the steel industry [1]. Core Insights - Market expectations for a demand recovery in China remain cautious, with a focus on tracking high-frequency on-ground demand trends [1]. - Steel production in China has decreased by 2.4% week-over-week (WoW) and 4.3% year-over-year (YoY) for the week of June 6 to June 12, totaling 8.6 million tons [2]. - China's steel inventory as of June 12 was 13.5 million tons, down 0.7% WoW and 23.3% YoY, indicating a tightening supply [3]. - Apparent steel consumption in China for the same week was 8.7 million tons, reflecting a decline of 1.6% WoW and 2.3% YoY [4]. Production Summary - Total steel production from the beginning of the year until now stands at 204.2 million tons, which is a decrease of 1.1% YoY [2]. - Specific production figures for rebar, hot-rolled coil (HRC), and cold-rolled coil (CRC) are 51 million tons, 76.5 million tons, and 20.7 million tons respectively, with varying YoY changes [2]. Inventory Summary - The inventory breakdown shows that steel mills hold 4.3 million tons and traders hold 9.3 million tons, with significant YoY reductions in both categories [3]. - The total inventory for rebar, HRC, and CRC is 5.6 million tons, 3.5 million tons, and 1.4 million tons respectively, with notable declines in rebar and CRC inventories YoY [3]. Consumption Summary - Year-to-date apparent consumption of steel in China is 201.6 million tons, which is a slight decrease of 0.3% YoY [4]. - The apparent consumption figures for rebar, HRC, and CRC year-to-date are 49.3 million tons, 76.2 million tons, and 20.8 million tons, showing mixed YoY performance [4].