Posted on 04 Aug 2026
Hot-rolled coil (HRC) production among the 37 Chinese steelmakers regularly surveyed by Mysteel shrank by 93,600 tonnes or 3.1% on week to 2.93 million tonnes during July 23-29, as widening margin losses and lackluster demand prompted more steel mills to halt production for maintenance, Mysteel Global learned.
Three mills in North China and one in Northeast China idled facilities to start maintenance work during the survey week, according to Mysteel's latest survey finding.
The average capacity utilization rate for strip mills among the surveyed 37 steelmakers fell by 2.39 percentage points on week to 74.77% during the latest survey week, while the average operation rate contracted by a large 4.69 percentage points to 75%, the survey showed.
Despite the fall in hot coil output, lackluster end-user demand, coupled with the refusal of traders to accept more coils from the mills in their already overstocked warehouses, caused HRC inventories at steelmakers to inch higher. Those held by the 37 sampled mills mounted by 3,400 tonnes or 0.43% on week to 801,800 tonnes as of July 30, according to Mysteel's assessment.
Similarly, retail HRC inventories across China also swelled during the survey week, especially for the country's south in the aftermath of Typhoon Noul where flooding and logistics disruptions delayed deliveries, market sources suggested. The tonnage piled at the 194 commercial warehouses Mysteel monitors nationwide had swollen by 89,300 tonnes or 1.9% on week to 4.76 million tonnes by July 30. This was 33.1% higher on year, Mysteel data show.
On the cost front, weakening steelmaking raw material prices including those of iron ore and met coke further eroded cost support for the steel market. This, together with elevated inventories and persistent weakness in end-user demand, caused HRC prices in both the derivatives and spot markets to lose further ground last week.
On July 31, the most-traded HRC contract for October delivery on the Shanghai Futures Exchange closed at Yuan 3,220/tonne ($477/t), lower by a marked Yuan 63/t or 1.9% from the settlement price one week earlier, the exchange's data showed.
Weighed down by the bearish performance in hot coil futures, on the same day Mysteel assessed the national spot price of Q235B 4.75mm HRC lower by Yuan 30/t or 0.91% on week at Yuan 3,273/t including the 13% VAT, the lowest level since early March.
Source:Mysteel Global
