Posted on 03 Sep 2025
China's construction steel market is expected to dip initially this month before gradually improving later, as short-term pressures from supply and costs interact with expectations for a demand recovery and a contraction in production, according to Mysteel's latest monthly report.
Supportive macroeconomic policies from the central government, plus the prospect of interest rate reductions, may provide some improvement in market sentiment this month, the report notes, but underlying demand remains fragile due to the property sector's persistent weakness, it warns.
Despite shrinking margins, construction steel output across China is expected to remain elevated in the first half of September. Weekly rebar production among the 137 mills under Mysteel's tracking is projected to hover around 2.2 million tonnes, Mysteel forecasts, with little room for further growth given the mills' breakeven profits and better returns from flat steel products. Output could retreat later in the month as margins shrink, helping to ease the supply-side pressure.
By end-August, weekly rebar output among the 137 sampled mills totaled 2.21 million tonnes, higher by 95,000 tonnes on month and jumping by 583,000 tonnes on year, Mysteel's data indicated.
High production and muted consumption last month led to inventory accumulation, a trend expected to persist into September, according to the report.
Rebar stocks at the 137 surveyed mills amounted to 1.7 million tonnes by the end of August, up 74,700 tonnes on month and by 167,500 tonnes on year. Meanwhile, the tonnage held by traders in the 35 cities under Mysteel's coverage had mounted by 696,300 tonnes on month and 109,300 tonnes on year to 4.5 million tonnes.
Meanwhile, spot demand stayed weak last month as Mysteel's statistics showed the average daily trading volume of rebar, wire rod, and bar-in-coil across the 237 trading houses Mysteel checks nationwide averaged a mere 98,150 tonnes/day, declining by 4% or 4,083 t/d from the July average and indicating that the summer lull had slowed construction activity.
Construction steel prices are expected to soften in early September amid subdued demand and inventory accumulation. As production falls and seasonal demand gradually improves, prices may stabilize and recover in the latter half of the month, the report suggested.
As of September 1, China's national price of HRB400E 20mm dia rebar, for example, was assessed by Mysteel at a 1.5-month low of Yuan 3,297/tonne ($461/t) including the 13% VAT, dropping by Yuan 98/t on month.
Source:Mysteel Global
