Posted on 06 Aug 2026
China’s prices for carbon steel hot-rolled coil (HRC) are expected to remain under pressure this month, with few signs pointing to any broad recovery in prices, Mysteel’s monthly report on the commodity suggests. The key variable is the extent and scale of any production cuts that steelmakers might undertake to reduce their losses, it says.
During July, domestic hot coil prices generally softened, as demand from end-user sectors such as construction machinery makers and steel structure fabricators slowed significantly amid the summer heat and rains.
The protracted weakness in HRC exports and fading cost-side support for hot coils in the latter half of last month combined to edge HRC prices lower on month. At end-July, Mysteel assessed the national spot price of Q235B 4.75mm HRC at Yuan 3,273/tonne ($485/t) including the 13% VAT, lower by Yuan 67/t or 2% from end-June.
Entering August, some mills are curbing production by undertaking strip-mill maintenance work. But the output cuts will be too mild to reverse the prevailing current supply-demand imbalance and so help prices to lift, the report notes.
According to a Mysteel survey, scheduled maintenance of hot-rolling mills nationwide this month could trim HRC output by 458,700 tonnes.
However, the reduced output is likely to be partly offset by the resumption of rolling lines after their overhauls are completed, the survey showed. With HRC supply also increasing from output on some newly-commissioned strip mills being ramped, previous maintenance stoppages have already proven to be ineffective, the monthly report observed. This month's stoppages will be just as unsuccessful.
During July 23-29, HRC production among the 37 Chinese steelmakers regularly surveyed by Mysteel stood at 2.93 million tonnes, lower by a modest 3.2% or 96,200 tonnes on month.
On the other hand, demand for hot coils from end-user sectors is expected to remain muted as the summer lull continues.
The Purchasing Managers' Index for China's manufacturing sector during July contracted by 1.1% to 49.2%, indicating slower economic and production activity, as Mysteel Global reported. The new orders sub-index also retreated by 2.7% to 48.5% and the production sub-index fell 1.5% to 49.9% last month, all below the threshold of 50 connoting contraction.
Meanwhile, the report says hot coil exports are unlikely to improve domestic market dynamics, especially as trade remedy measures will continue to impact flat steel shipments abroad. In June, China exported 1.64 million tonnes of HRC (including carbon steel HRC and other hot-rolled alloy steel like HR stainless coil), lower by 14.8% on year and unchanged from May.
Furthermore, waning cost support due to falling raw material prices is aggravating the situation, the report observed.
By August 4, Mysteel SEADEX 62% Australian Fines was lower by $4.25/t or 4.3% from July 3 and is predicted to keep drifting lower this month. The same day, the Mysteel Coke Index CWQ for wet-quenched quasi first-grade met coke stood at Yuan 1,740.4/t including VAT, down by 5.2% or Yuan 95.6/t on month.
Given these downside factors, prices of carbon steel HRC are likely to continue softening this month, with the rate of decrease dependent upon output curtailment efforts by mills.
A temporary stabilization with small fluctuations is possible, the report suggested. However, any definitive price reversal will hinge upon further HRC supply tightening via mill production curbs, and evidence of a clear revival in end-user procurement, it added.
Source:Mysteel Global
