1. Report Industry Investment Rating No relevant content provided. 2. Core Views - This week, the inventory of the five major steel products decreased slightly by 0.35 million tons to 13.3958 million tons, showing a continuous slight decline. Among them, the social inventory decreased slightly, while the steel mill inventory increased slightly by 0.42%. In terms of production, the output of the five major products decreased by 124,000 tons week-on-week. Only the output of medium and heavy plates increased month-on-month, while the output of rebar and wire rods both decreased by more than 2% month-on-month, indicating that the effects of the production restriction policy are gradually emerging. The inventory showed mixed trends, but the apparent demand for the five major products decreased month-on-month, with wire rods and cold-rolled products leading the decline [2]. - In general, steel prices are still prone to pressure during the off-season. The relatively positive factor is that the inventory is at a low level, and there are not many real contradictions. Moreover, recent policy benefits have fermented, and steel mills have increased their production cut efforts. The subsequent reduction in steel production will gradually become apparent, and the industrial fundamentals will improve. Coupled with the strong cost support from raw materials, it is expected that steel prices will maintain a relatively strong operating trend in the short term. The previous low points may become history, but the upside potential still needs to be observed. Attention should be paid to policy developments [2]. 3. Summary by Directory 3.1 Market Review and Price Performance 3.1.1 Futures and Spot Price Trends - Futures market: This week, the main rebar contract RB2510 rose significantly, closing at 3,132 yuan/ton, up 47 yuan/ton week-on-week, with a position of 2.23 million lots, a decrease of 7,200 lots. The main hot-rolled coil contract HC2510 also rose significantly, closing at 3,262 yuan/ton, up 54 yuan/ton week-on-week, with a position of 1.5971 million lots, an increase of 1,800 lots [5]. - Spot market: This week, the spot price of rebar shifted upward. As of July 11, the price of HRB400E 20MM in Beijing decreased by 10 yuan/ton to 3,150 yuan/ton compared with last week. The spot price of hot-rolled coils shifted downward. As of July 11, the price of Benxi Steel 5.75*1500*C:Q235B in Tianjin increased by 50 yuan/ton to 3,180 yuan/ton compared with last week [6]. 3.1.2 Spread Changes - Futures-spot spread: This week, the basis of the main rebar contract RB2510 compared with the HRB400E 20MM spot in Shanghai was 67 yuan/ton, a change of -31 yuan/ton compared with the previous week. The basis of the main hot-rolled coil contract HC2510 compared with the 5.5*1500*C:Q235B:Ansteel spot in Shanghai was 18 yuan/ton, a change of -31 yuan/ton compared with the previous week [10]. - Inter-month spread: This week, the spread between RB2601 and RB2510 was 28 yuan/ton, a change of +7 yuan/ton compared with the previous week. The spread between HC2601 and HC2510 was 10 yuan/ton, a change of +1 yuan/ton compared with the previous week [11]. - Rebar-hot rolled coil spread: This week, the spread between HC2510 and RB2510 was 139 yuan/ton, a change of +10 yuan/ton compared with the previous week. The spread between HC2601 and RB2601 was 121 yuan/ton, a change of +4 yuan/ton compared with the previous week [12]. 3.2 Supply and Demand Analysis 3.2.1 Supply - This week, the blast furnace operating rate of 247 steel mills surveyed by Mysteel was 83.15%, a decrease of 0.31 percentage points week-on-week and an increase of 0.65 percentage points year-on-year. The profitability rate of steel mills was 59.74%, an increase of 0.43 percentage points week-on-week and an increase of 22.94 percentage points year-on-year. The daily average pig iron output was 2.3981 million tons, a decrease of 10,400 tons week-on-week and an increase of 15,200 tons year-on-year [19]. - This week, the total weekly output of the five major steel products was 8.7272 million tons, a decrease of 124,400 tons week-on-week. The effects of the production restriction policy are gradually emerging. Only the output of medium and heavy plates increased month-on-month, while the output of rebar and wire rods both decreased by more than 2% month-on-month [19]. 3.2.2 Demand - Last week, the US government imposed a "tariff bomb" on 14 countries. US President Trump posted several letters on social media, stating that starting from August 1, import products from 14 countries will be subject to tariffs ranging from 25% to 40%. The tariffs on China remain the same as before. Against the background of the current rush to export, the demand for hot-rolled coils is still stronger than that for rebar. Coupled with the arrival of the seasonal off-season demand for building materials, this pattern is expected to continue for some time. There are signs of easing in the Sino-US trade friction and expectations of future interest rate cuts by the Federal Reserve. It is expected that the implementation path of the off-season logic will be less smooth, and demand will maintain a certain level of resilience [28]. 3.2.3 Inventory - This week, the social inventory of steel products in major cities across the country was 9.1401 million tons, a decrease of 21,200 tons week-on-week. The inventory of steel mills by variety was 4.2557 million tons, an increase of 17,700 tons week-on-week. The total social + steel mill inventory was 13.3958 million tons, a decrease of 350 tons week-on-week. The overall inventory is at a low level compared to the same period, continuing a certain de-stocking trend [33]. 3.2.4 Profit - This week, the profitability rate of 247 steel mills surveyed by Mysteel increased slightly to 59.74%. The cost of electric arc furnace steel mills increased slightly by 15 yuan/ton to 3,262 yuan/ton. The steel price trend was relatively strong, and the price increase of rebar in many regions was greater than that of scrap steel. Profits have rebounded. The average profit of steel mills was -107 yuan/ton, and the valley electricity profit was -4 yuan/ton, an increase of 14 yuan/ton week-on-week [44]. 3.2.5 Raw Material Prices - This week, the prices of major raw materials generally stabilized and rebounded. Among them, the price of Tangshan billet increased by 24 yuan/ton to 2,983 yuan/ton, and the price of 61.5% PB powder increased by 23 yuan/ton to 748 yuan/ton [53]. 3.3 Summary and Investment Suggestions - This week, the inventory of the five major steel products decreased slightly by 0.35 million tons to 13.3958 million tons, showing a continuous slight decline. Among them, the social inventory decreased slightly, while the steel mill inventory increased slightly by 0.42%. In terms of production, the output of the five major products decreased by 124,000 tons week-on-week. Only the output of medium and heavy plates increased month-on-month, while the output of rebar and wire rods both decreased by more than 2% month-on-month, indicating that the effects of the production restriction policy are gradually emerging. The inventory showed mixed trends, but the apparent demand for the five major products decreased month-on-month, with wire rods and cold-rolled products leading the decline [56]. - In general, steel prices are still prone to pressure during the off-season. The relatively positive factor is that the inventory is at a low level, and there are not many real contradictions. Moreover, recent policy benefits have fermented, and steel mills have increased their production cut efforts. The subsequent reduction in steel production will gradually become apparent, and the industrial fundamentals will improve. Coupled with the strong cost support from raw materials, it is expected that steel prices will maintain a relatively strong operating trend in the short term. The previous low points may become history, but the upside potential still needs to be observed. Attention should be paid to policy developments [56].