China: Steel inventories rise in early Mar’26, production shows downtrend

• Steel inventories rise at key mills by 2.7%
• Production declines across major segments

The China Iron and Steel Association (CISA) reported that total steel inventory at key China mills stood at 17.81 million tonnes (mnt) in early-March 2026 (1-10 March), rose by 470,000 tonnes (t) or 2.7% compared with 17.34 mnt in late-February 2026.

Additionally, inventories increased by 2.7 mnt or 17.9% m-o-m from 15.11 mnt in early-February, and on a yearly basis increased by 1.57 mnt or 9.7% compared with 16.24 mnt in early-March 2025.

Production volume

The average daily crude steel production in CISA-affiliated mills stood at 2.011 mnt in early-March 2026, a marginal decrease of 0.8% from 2.03 mnt in late-February. Furthermore, output decreased by 5.7% y-o-y from 2.13 mnt in early-March 2025.

Average daily finished steel output stood at 1.845 mnt in early-March, marking a decrease of 12.6% from 2.111 mnt in late-February. Furthermore, this level dropped by 8.1% y-o-y.

Average daily pig iron output stood at 1.821 mnt in early-March, marking a decrease of 4% from 1.897 mnt in late-February. Compared with the same period last year, output declined by 3.5% y-o-y.

Outlook

Due to the ongoing geopolitical tensions between US-Israel and Iran, which has created uncertainty around maritime safety and logistics through the Strait of Hormuz, Chinese HRC exporters have been encountering serious disruptions in shipments. As a result, inventory level is increasing and excess supply may shift to the domestic market. However, downtrend in steel production is expected to continue.