Monthly Summary: The market price of bearing steel may experience narrow fluctuations in April

Monthly Summary: The market price of bearing steel may experience narrow fluctuations in April

Overview: In January and February 2025, the crude steel production of domestic bearing steel decreased by 7.31% year-on-year, and the production of bearing steel decreased by 0.54% year-on-year. Looking back at the market situation in March, the downstream mentality is cautious, maintaining an on-demand procurement strategy, and spot prices are under pressure to decline due to demand suppression. As of now, the average price of 50mm (continuous casting) bearing steel in China is 4940 yuan/ton, a decrease of 25 yuan/ton or 0.5% from the beginning of the month. The bearing steel market is affected by multiple factors such as downstream demand, raw material costs, and industry policies, resulting in an overall weak supply and continuously bottoming out prices. It is expected that the bearing steel market prices will experience narrow fluctuations in April.

Ⅰ Domestic production of bearing steel

1. Bearing steel production in January and February 2025: crude steel and steel mills decrease year-on-year

According to statistics from the Special Steel Association, the crude steel production of bearing steel by major special steel enterprises in China in January and February 2025 was 858300 tons, a decrease of 7.31% compared to the same period last year; In January and February 2025, the production of bearing steel by major special steel enterprises in China was 765800 tons, a decrease of 0.54% compared to the same period last year.

2. Bearing steel production in March 2025: Steel production increases month on month

According to the 21 samples collected by the Bearing Steel Research Group, the production of bearing steel by major special steel enterprises in China in March 2025 was 395500 tons. Among them, there are 324900 tons of rods, accounting for 82.15%; 70600 tons of wire, accounting for 17.85%.

According to the research sample, it can be seen that the production of bearing steel bars and wires increased in March compared to the previous month. The total amount of bearing steel increased by 4% month on month, with a 4.23% increase in bar materials and a 2.92% increase in wire rods.

3. Finished material output of bearing steel production enterprises in January and February 2025: total output of steel mills slightly increased

At present, the major producers of bearing steel are CITIC Special Steel (Xingcheng Special Steel, Daye Special Steel, Qingdao Special Steel), Jiyuan Steel, and Juneng, accounting for 66% of the total production. The overall production of bearing steel will slightly decrease in January and February 2025. Steel mills such as Juneng, Jiyuan, Zhongtian, and Benxi Iron and Steel will increase their production compared to the same period last year. Steel mills such as CITIC Special Steel, Jianlong Beiman, Dongte Shares, and Shigang will all experience a decline in production.

Ⅱ Performance of domestic bearing steel market

The market price of bearing steel slightly decreased in March. If the current social inventory is at a medium high level, the pressure of destocking will suppress the rebound space. In terms of emotions, traders have lowered prices to promote transactions, but downstream and end users have a strong wait-and-see attitude, which is bearish on the future market. It is expected that the price of bearing steel market in April may fluctuate narrowly.

Ⅲ Related market information

1. Raw material prices

The 62% Australian flour forward price index is 104.1 US dollars per dry ton, an increase of 3.3 yuan per ton from the beginning of the month, an increase of 3.27%. Looking ahead to April, China's iron ore supply and demand may show a dual strong situation. On the supply side, the daily average shipping volume of iron ore in April is expected to decrease month on month and increase year-on-year; Based on the comprehensive analysis of previous shipments, floating inventory, and arrival ratios, the expected arrival volume at 47 ports is expected to show a slight increase compared to the same period last month. On the demand side, the production of molten iron in April is about to reach its peak, and the overall daily average production of molten iron is higher than that in March. Port transportation is expected to remain at a relatively high level. Overall, in April 2025, the supply and demand of iron ore in the Chinese market will maintain a tight balance, and port inventories are expected to fluctuate narrowly.

The current spot price of high carbon ferrochrome is 7900 yuan/ton, an increase of 400 yuan/ton or 5.3% from the beginning of the month. On March 31st, the spot price of high carbon ferrochrome remained stable, with coke prices, national freight rates, and electricity rates all operating steadily. The spot price of chromite ore increased by 1 yuan/ton, and the spot cost of high carbon ferrochrome increased by 5-32 yuan/50 basis tons. In April, the steel price rose by 600 yuan, boosting the sentiment of the chromium market. It is expected that the price of chromite ore will continue to rise, and the short-term cost of high carbon ferrochrome will rise.

The current price of scrap steel is 2110 yuan/ton, a decrease of 40 yuan/ton or 1.9% from the beginning of the month. Affected by the "equivalent tariffs", the linkage between futures and stocks has shown a weakening trend, and the decline in the black market has deepened again, further fueling bearish sentiment among industry players. Although spot steel prices have shown some resistance due to a lack of specifications, the production of molten iron is approaching its previous peak, and the downstream demand release is not as strong as expected during the peak season, so steel lacks strong upward support. Overall, the domestic scrap steel market may stabilize and weaken in the short term, requiring constant attention to macroeconomic disturbances both domestically and internationally.

2. Downstream industry

According to data released by the China Association of Automobile Manufacturers, in February, the production and sales of automobiles reached 2.103 million and 2.129 million respectively, a decrease of 14.1% and 12.2% month on month, and an increase of 39.6% and 34.4% year-on-year, respectively. From January to February, the cumulative production and sales of automobiles reached 4.553 million and 4.552 million respectively, an increase of 16.2% and 13.1% year-on-year. The China Association of Automobile Manufacturers (CAAM) stated that the good start of the automotive industry has laid the foundation for achieving a successful start to the first quarter. In the first two months of this year, a new round of trade in policies has been strengthened and implemented early, with the upgrading of enterprise technology and the revitalization of products stimulating demand. Overall, automobile production and sales have shown steady growth. Among them, passenger cars continue to perform well, the commercial vehicle market has rebounded, new energy vehicles have shown impressive performance, and production and sales continue to grow rapidly. It is expected that the automobile market will continue to show a stable and positive development trend in 2025.

Ⅳ Summary

In terms of demand, downstream industries such as machinery and automobiles are currently cautious in their procurement, mainly relying on on-demand procurement. The market is showing a shortage of terminal orders and an extended inventory digestion cycle. In terms of emotions, terminals are cautious and watching, traders are lowering prices to promote transactions, and the market is showing a phenomenon of "quantity reduction and price decline", indicating a lack of confidence in short-term market trends. Overall, it is expected that the short-term market will continue to show further bottoming out, but with the implementation of a series of policies in April, it is expected to be reflected in the middle of the month. There is still room for a positive trend in the market, and it is expected that the price of bearing steel in April will fluctuate narrowly.