Steel Hits Near 1-Month Low

Steel rebar futures dropped below CNY 3,160 per ton, hovering near their lowest level in almost a month as weak demand continued to weigh on prices. Steel margins in China remain under pressure amid persistent weakness in the country’s infrastructure and property construction sectors. Demand for Chinese steel exports has also softened, with overseas buyers showing limited appetite for purchases at elevated prices. China’s steel output declined 2.8% year-on-year to 86.63 million tons in April, marking the weakest April reading since 2018. Meanwhile, the latest monthly industry report from Mysteel indicated that long steel production is expected to increase as improved profitability encourages domestic steelmakers to raise output. However, the prospect of higher supply could create additional downward pressure later this month if end-user demand continues to deteriorate.

Steel rebar futures climbed above CNY 3,200 per ton, recovering from three-week lows as global steel production declined in April at a slower pace than in March, with the contraction in China’s steel output also easing. The data helped support market sentiment, though broader demand conditions remained mixed. Steel margins in China continue to face pressure amid persistent weakness in the country’s infrastructure and property construction sectors. Demand for Chinese steel exports has also softened, with overseas buyers showing limited willingness to purchase at elevated prices. Meanwhile, Mysteel’s latest monthly industry report indicated that long steel production is expected to rise as improved profitability encourages domestic steelmakers to increase output. However, the prospect of higher supply could add fresh downward pressure later this month if end-user demand continues to weaken.

Steel rebar futures fell to around CNY 3,170 per ton, hovering near their lowest levels in three weeks as signs of slowing economic activity in top consumer China weighed on the outlook for steel demand. Data released earlier this week showed that China’s retail sales and industrial production both missed expectations, while fixed asset investment unexpectedly contracted amid the impact of the global energy crisis on businesses and consumers worldwide. Domestic steel consumption in China also remained under pressure from sluggish construction activity, while demand for Chinese steel exports weakened as overseas buyers showed limited appetite for purchases at elevated prices. Meanwhile, Mysteel’s latest monthly industry report indicated that long steel output is likely to increase as improved profit margins encourage domestic steelmakers to ramp up production, potentially creating additional downward pressure later this month as end-user demand softens.