- Chinese steel prices climb amid stronger post-holiday market sentiment.
- Raw material costs rise while downstream buyers remain cautious.
China’s steel prices moved sharply higher in the week ended 8 May 2026, with domestic hot-rolled coil (HRC) and rebar prices recording notable week-on-week (w-o-w) gains. On the raw materials front, prices of iron ore, coking coal, and billet also trended upward compared with the previous week.
The China Iron and Steel Association (CISA) announced that total steel inventories at key Chinese industries totalled at around 15.43 million tonnes (mnt) in late-April (21-30 April), dropped by 3.2 mnt or 17.2% compared with 18.63 mnt in mid-April 2026.
On a m-o-m basis, the inventory level decreased by 1.12 mnt or 6.8% m-o-m from 16.55 mnt in late-March, and on yearly basis marked a marginal up of 140,000 tonnes (t) or 0.9% y-o-y from the same period last year.
Before the May Day holiday, market participants avoided fresh stocking and supplied material only based on demand, which resulted in lower inventory levels in the market.
1.Iron ore spot prices rise higher w-o-w: Iron ore fines benchmark prices for Fe 61% climb $4/dmt w-o-w to $112/dmt CFR China on 8 May’26. Prices surged amid stronger futures and improved steel market sentiment, driving active trade following the Labour Day holidays (1-5 May). However, buyers remained cautious due to sufficient material availability and expectations of some correction in prices. Demand from Chinese steel mills stayed healthy after the holidays, with occasional preference seen for more competitively priced portside cargoes.
a) Spot pellet premium edge up w-o-w: Spot pellet premium for Fe 65% grade pellet increased to $17.40/t CFR China on 6 May.
b) Spot lump premium edges down w-o-w: Spot lump premium fell marginally w-o-w to $0.1770/dmtu on 8 May.
2. Firm Chinese coke market and rising seaborne coking coal prices support met coal sentiment: China’s coke and coking coal markets remained firm w-o-w, supported by supply disruptions, rising spot coal prices, and steady steel demand. Improved steel margins kept coke procurement healthy, while the third round of coke price hikes remained under negotiation and is likely to be implemented.
Australian premium hard coking coal (PHCC) prices rose by $9/t w-o-w to $240/t FOB as of 8 May 2026, supported by firm Asian demand and tighter spot supply. Consequently, BigMint’s PHCC index increased by $13/t w-o-w to $266/t CNF Paradip amid higher import costs and freight rates.
3.Billet prices rise w-o-w: Chinese billet prices increased by RMB 60/t ($9/t) w-o-w to RMB 3,100/t ($456/t) on 8 May, compared to RMB 3,040/t ($444/t) on 1 May. The rise was supported by stronger post-holiday sentiment, speculative futures buying, firm raw material costs, and stable mill output. Improved physical steel sales and inventory reduction also supported domestic prices.
Billet export prices rose to around $482/t FOB China by the weekend, supported by firm domestic prices and steady export sentiment.
4. Domestic HRC prices surged w-o-w: Chinese HRC prices jumped by RMB 110/t ($16/t) stood at around RMB 3,310/t ($487/t) as on 8 May 2026 compared with RMB 3,200/t ($471/t) from the previous week. Moreover, SHFE HRC futures (October 2026 contract), rose by RMB 72/t ($10/t) w-o-w to RMB 3,485/t ($513/t) from RMB 3,413/t ($502/t) a week earlier. Meanwhile, China’s HRC export offers increased by $5/t w-o-w at around $510/t FOB, Rizhao from the previous week.
However, with prices continuing to rise after May-Day holiday, downstream buyers are turning cautious, limiting purchases to immediate needs while speculative restocking demand has sharply declined.
5. Rebar prices increase w-o-w: Rebar prices in China stood at around RMB 3,410 ($502/t) as on 8 May, increasing by RMB 60/t ($9/t) w-o-w compared with RMB 3,350/t ($493/t) in the previous week. Moreover, SHFE rebar futures (October 2026 contract), also rose marginally by RMB 71/t ($10/t) w-o-w to RMB 3,275/t ($482/t) as on 8 May from RMB 3,204/t ($471/t) a week earlier.
China’s Shagang Steel has kept its long steel prices unchanged for early-May’26 sales, after cutting them in late-April. Prices of rebars, coiled rebars, and wire rods are as follows:
- Rebars (16-25 mm): RMB 3,350/t ($493/t)
- Coiled rebars (8-10 mm): RMB 3,480/t ($512/t)
- Wire rods (6-10 mm): RMB 3,390/t ($499/t)
Outlook
China’s steel market may remain firm in the near term, supported by post-holiday sentiment, although buyers may turn cautious as the holiday has just ended and prices have surged sharply in a short span. Whereas, low rebar supply, and rising raw material costs prices are likely to edge up further amid improving demand expectations and shortages in northern China.
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