- Adverse weather hits steel demand in H2 of Aug
- Production halts in late-Aug fail to support prices
Mysteel: Profits on finished steel sales earned by China’s blast-furnace (BF) steel mills dropped in August 2025, mainly due to the fast growth in their production costs and the retreat in finished steel prices, according to Mysteel’s latest monthly survey among 91 BF mills nationwide.
For August, the average profit on rebar sales among the sampled mills came in at RMB 18/tonne (t) ($2.5/t), plunging from RMB 196/t on average during July, while their profits on sales of hot-rolled coils (HRCs) fell to RMB 128/t on average from RMB 279/t in the previous month.
The sampled steelmakers’ average profit on sales of medium plates also declined last month to RMB 198/t, lower by RMB 137/t from the average for July, the findings showed.
The significant decrease was blamed on the mills’ rising production costs, mainly caused by higher prices of major steelmaking raw materials such as iron ore and coke.
During August, the average production cost for making rebars among the sampled BF steelmakers was at RMB 3,069/t, including 13% VAT, higher by RMB 84/t m-o-m, according to the survey.
The average costs incurred by the sampled mills making HRCs and medium plates registered RMB 3,251/t and RMB 3,273/t, respectively, including the VAT, higher by RMB 109/t and RMB 110/t compared with July.
Last month, Mysteel’s iron ore SEADEX 62% Australian Fines index averaged $101/dry metric tonne (dmt) CFR Qingdao, rising by $2/t from July, while the average price of second-grade metallurgical coke in North China rose by RMB 234/t m-o-m to RMB 1,399/t, the survey results showed.
Besides, China’s finished steel prices weakened in the second half of August, another major factor cited for the contraction in mills’ profit margins, Mysteel Global noted.
For example, on 29 August, Mysteel assessed China’s national price of HRB400E 20mm dia rebars, a bellwether of domestic steel-market sentiment, at RMB 3,326/t, including the 13% VAT, falling by RMB 81/t from the end of July. During the same period, the national price of Q235 4.75-mm HRCs under Mysteel’s assessment had slipped by RMB 23/t m-o-m to RMB 3,458/t, including 13% VAT.
Market sentiment cooled in the second half of August, as steel demand from end-users remained lacklustre, caused by high temperatures and frequent heavy rains across most regions of China. Although some steel mills in northern China were required to suspend production in late August to improve air quality, support for domestic steel prices was limited, Mysteel Global learnt.
Additionally, during August, the daily trading volume of construction steel comprising rebars, wire rods, and bars-in-coil among 237 Chinese trading houses nationwide under Mysteel’s tracking reached 98,150 t/day on average, lower by 4,083 t/d or 4% from the previous month.
Note: This article has been written in accordance with a content exchange agreement between Mysteel Global and BigMint.
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