Posted on 30 Jun 2025
China's steel market is expected to face more pressure in the near term, as demand from end-users may shrink further in the summer months, typically the off-season for steel consumption, according to the latest monthly report of the China Iron & Steel Association (CISA).
The association emphasized that supply remains the decisive factor for steel price movements in the coming term. It urged domestic steelmakers to rationally adjust production schedules, optimize their product mix based on profitability and demand shifts, and maintain self-discipline in output control to help stabilize steel prices.
China's steel output stayed at a relatively high level in early June, with the daily crude steel production among CISA's member mills reaching 2.16 million tonnes/day, increasing by 3.2% from the average for late May.
With the high-level output, inventories of the five major steel products - rebar, wire rod, hot-rolled coil, cold-rolled coil and medium plate - held by CISA's member mills also climbed to 15.8 million tonnes as of June 10, higher by 3.2% from the end of May. During the same period, inventories of the five steel items in the 21 Chinese cities under CISA's regular tracking emptied slowly by 1% to 7.86 million tonnes.
On the macro front, CISA warned of persistent headwinds for global economic recovery this year. The global manufacturing Purchasing Managers' Index (PMI) registered 49.2 in May, staying in the contraction zone for the third consecutive month, the association quoted data compiled by the China Federation of Logistics & Purchasing.
Additionally, the Organization for Economic Co-operation and Development (OECD) revised its global economic growth forecast for 2024 to 2.9% in early June, down from the previous estimate of 3.1% it made in March, and trimmed its 2026 projection to 2.9% from 3%, citing escalating trade tensions and elevated policy uncertainty, as reported.
CISA projected that the global steel trade environment will become more complex this year amid heightened international competition. Dozens of trading cases have been launched against Chinese steel products since last year, putting significant pressure on China's steel exports.
Earlier this month, the United States announced it would double tariffs on imported steel to 50%, effective June 4. A 50% tariff will also be applied to steel-made household appliances such as dishwashers, washing machines, and refrigerators starting June 23.
Under such circumstances, Chinese steel mills need to closely monitor changes in global steel demand and the impact of trade protectionism and adjust their export strategies in time while actively exploring emerging markets to diversify risks, the association suggested.
Source:Mysteel Global
