- Crude steel production falls 3% y-o-y in H1CY’25
- Steel exports rise 11% y-o-y in Jun’25 to nearly 10 mnt
The Chinese steel market saw an uptick in prices this week, largely mirroring the rise in Shanghai Futures Exchange (SHFE). Domestic steel product prices, including billet, hot-rolled coil (HRC) and rebar, saw w-o-w increases. Moreover, in the raw material segment, iron ore prices went up while coking coal prices dropped.
Chinese steel exports rose by 10.7% y-o-y to 9.678 million tonnes (mnt) in June 2025 from 8.75 mnt a year ago.
China’s crude steel output dropped around 3% y-o-y to 514.83 mnt in H1CY’25, against 528.14 mnt in the same period last year.
The China Iron and Steel Association (CISA) has announced that total steel inventory at key Chinese enterprises in early-July stood at 15.07 mnt, down by 380,000 tonnes (t) or 2.4% as compared to 15.45 mnt in late-June.
1. Iron ore spot prices rise w-o-w: The benchmark iron ore fines spot prices rose $2/t w-o-w to $100/dmt CFR China on 18 July amid steady buying and market optimism. Strong iron ore fundamentals due to demand for special grade products and rising hot metal output kept steel margins steady, while supportive policies and higher coke prices lifted ferrous market sentiment.
Iron ore inventory at Chinese ports dropped by 1 mnt w-o-w to 130.9 mnt on 17 Jul, as per data published by SteelHome.
a) Spot pellet premium rises w-o-w: Spot pellet premium for Fe 65% grade pellet inched up by $1.35/t w-o-w to $16.65/t CFR China on 16 July. Pellet premium touched over five-month high with the last being recorded in the first half of February.
b) Spot lump premium edges up w-o-w: Spot lump premium inched up slightly by $0.002/dmtu to $0.17/dmtu on 18 July.
2. Coking coal prices inch down w-o-w: Australian premium hard coking coal prices were assessed at $173/t FOB, down by $5 w-o-w. BigMint’s premium hard coking coal (PHCC) index was assessed at $186/tonne (t) CNF Paradip, India, on 18 July 2025, down by $8/t against the previous assessment on 11 July.
3. Chinese billet prices rise w-o-w despite early pullback: Billet prices in Tangshan rose by RMB 50/t ($7/t) w-o-w to RMB 3,110/t ($433/t incl. VAT) on 18 July. Prices had initially increased at the start of the week on positive policy signals, firm rebar futures, and lower inventories, hinting at improved sales. However, minor drop in prices in the mid-week amid muted housing demand, volatile raw material costs, and relatively sluggish exports sentiments.
Despite this, a weekly gain was recorded, supported by optimism over capacity cuts and stronger raw material tags. SHFE rebar futures (Oct’25) also edged up by RMB 34/t ($5/t) w-o-w to RMB 3,167/t ($441/t).
4. Domestic HRC prices rise w-o-w: China’s HRC offers rose by RMB 60/t ($8/t) w-o-w to RMB 3,190/t ($444/t) against RMB 3,140/t ($437/t) following the increase in SHFE futures. SHFE HRC futures edged up by RMB 48/t ($7/t) w-o-w to RMB 3,321/t ($462/t) on 18 July against RMB 3,273/t ($456/t) on 11 July. The recent uptick in HRC prices is largely driven by rising raw material costs.
Moreover, Chinese HRC export offers went up by $8/t w-o-w to $458/t against $450/t a week ago.
5. Domestic rebar prices edge up w-o-w: China’s rebar edged up by RMB 20/t ($3/t) w-o-w to RMB 3,180/t ($443/t) against RMB 3,160/t ($440/t). SHFE rebar futures (October 2025 contract) stood at RMB 3,156/t ($439/t) on 18 July, edged up by RMB 23/t ($3/t) as compared to RMB 3,133/t ($436/t) on 11 July.
However, China’s rebar showed mixed signals as rising raw material costs pushed prices up, but fading demand due to bad weather and cash flow issues among contractors halted the uptrend.
Outlook
In the near term, steel prices may rise modestly, supported by strong sentiment and higher raw material costs. However, gains could be limited if demand weakens or inventories rise unexpectedly.
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