Posted on 03 Mar 2026
After sliding steadily during last month, Chinese steel prices are expected to rebound in March, driven by firming cost support amid turbulent international geopolitics, as well as the improved domestic fundamentals for steel, Mysteel's chief analyst Wang Jianhua predicts in his latest monthly outlook.
During February 1-28, China's national composite steel price averaged Yuan 3,411/tonne ($497.4/t) including the 13% VAT, lower by 0.9% from the average price during January, according to Mysteel's assessment. The price weakened last month as the domestic steel market quietened around the Chinese New Year holiday (CNY) over February 15-23, as reported.
Entering March, escalating trading friction across the world will likely cause Chinese traders to bear higher costs for imported iron ore, which may drive up prices throughout the country's entire ferrous industry, Wang noted.
The recent flare-up of military conflict involving the United States, Iran, and Israel has disrupted shipping through several key maritime channels in surrounding regions, especially the Strait of Hormuz, as Mysteel Global has reported.
This has forced a large number of vessels to take alternative routes between Europe and Asia, leading to longer global shipping times and a sharp increase in sea freight and insurance costs for most seaborne cargoes, Wang stressed.
Meanwhile, Chinese steel prices may also gain some upward momentum from the improved macroeconomic environment, Wang predicts.
At last Friday's CPC Central Committee meeting, great emphasis was placed on the need to implement more proactive fiscal policies and accommodative monetary policies to ensure a good start for China's 15th Five-Year Plan period, Wang pointed out.
Moreover, he added that the steel market is expecting more stimulus measures to be rolled out after the 'Two Sessions' meetings open this week in Beijing, namely the annual meetings of the National People's Congress and the National Committee of Chinese People's Political Consultative Conference.
On fundamentals, the recovery in domestic steel demand may also lend some support to steel prices, Wang projects.
"The construction sector is poised for steady recovery after the CNY break, with building projects benefiting from improved funding availability this year," he explained.
As of February 25, the funds disbursement rate at the 10,692 Chinese construction projects under Mysteel's tracking was 29%, significantly higher by 9 percentage points from the same period after last year's CNY holiday, while the operational rate at these work sites had increased 1.5 percentage points to reach 8.9%.
On the other hand, steel supply is unlikely to show any significant increase, as steelmakers' operation activity has been restricted by the narrow margins and government-mandated production curbs, Wang noted.
Many blast furnace steelmakers around Beijing have been ordered by local governments to cut production in early March to ensure good air quality for the Two Sessions gatherings, as reported.
Under such circumstances, steel inventories across China are expected to shrink overall this month, which underpin the steel prices as well, Wang predicts.
By the end of February, the total stocks of the five major carbon steel products held by steelmakers and trading houses across the 35 Chinese cities under Mysteel's monitoring were at their second lowest level for any similar period after a CNY holiday in the past five years at 18.5 million tonnes, Mysteel data shows. The volume was 10.5% higher compared with the same period after last year's CNY, however.
Source:Mysteel Global
