Steel Declines to Eight-Week Low

Steel rebar futures fell below CNY 3,060 per ton, sliding to an eight-week low as Chinese steel mills curtailed operations ahead of the extended Lunar New Year holidays. The sector entered a seasonal shutdown, with both blast furnaces and electric-arc furnaces pausing for scheduled maintenance. Heavy air pollution alerts in parts of Hebei may also prompt temporary production curbs. Meanwhile, data from the World Steel Association pointed to a decline in global steel supply in 2025, driven largely by output cuts in China under its anti-involution campaign. China remains the world’s largest steel producer, with output totaling 960.8 Mt. last year, followed by India, the US, Japan, and Russia, which together produced 395.4 Mt.

Steel rebar futures fell to around CNY 3,070 a ton, hitting a one-month low as Chinese steel mills trimmed production ahead of the Lunar New Year holiday. Several blast furnaces and electric-arc furnaces have paused operations for planned maintenance, weighing on near-term demand. However, industry data showed blast furnace utilization remained above 86%, higher than the previous week, while daily hot metal output rose by 21,000 tons week-on-week. Meanwhile, data from the World Steel Association pointed to a decline in global steel supply in 2025, led by production cuts in China under its anti-involution campaign. China remains the world’s largest steel producer, with output totaling 960.8 Mt. last year, followed by India, the US, Japan, and Russia, which together produced 395.4 Mt. On the demand side, official data showed Chinese construction activity rebounded in December after four consecutive months of contraction.

Steel rebar futures in China fell to CNY 3,100 per tonne after testing five-month highs of CNY 3,160 on January 29th, pressured by the recent decline in industrial metals as markets reconsidered speculative trades. Still, evidence that demand may have bottomed and efforts by Beijing to cap overcapacity maintained contracts above the flatline this year. China reportedly exempted major developers from submitting data that previously aimed to limit their access to leverage. Such a move would increase accessibility of loans and limit short-term liquidity risks for stressed constructors, improving the outlook for rebar-intensive projects. Meanwhile, the latest official data reflected a rebound in Chinese construction activity in December following four periods of contraction. Meanwhile, evidence from the World Steel Organization indicated a drop in global supply in 2025, led by cuts in China amid their anti-involution campaign.