China Steel Market Sees Moderate Recovery, Prices Edge Up in 2025 July

China Iron and Steel Association Releases June Steel Price Index Report

Recent data from the China Iron and Steel Association (CISA) shows that China's domestic steel market performed weakly overall in June due to seasonal factors and supply-demand imbalances. However, steel prices saw a modest rebound in July, driven by policy guidance and production restrictions in some regions.

1. Continued Decline in Steel Prices in June

In June, the China Steel Price Index (CSPI) averaged 90.10 points, down 2.45% month-on-month and 13.56% year-on-year. The price indices for long products and flat-rolled products fell by 2.55% and 2.51%, respectively. By the end of the month, the CSPI stood at 89.51 points, a 1.42% monthly decline and over 13% year-on-year drop.

Among major steel products, cold-rolled sheets saw the steepest price drop, falling by an average of RMB 152 per ton, while seamless steel pipes experienced the smallest decline at just RMB 28 per ton.

2. Nationwide Market Downturn

Steel prices declined across all six major regions in China, with the sharpest drop in North China (down 2.77%) and the mildest in Southwest China (down 1.72%).

3. Moderate Recovery in July

A slight rebound occurred in early July following policy signals from the Central Financial and Economic Affairs Commission, which called for curbing low-price competition and phasing out outdated capacity. Some regions also initiated controls on crude steel production. However, due to high temperatures and rainy weather, downstream demand recovery remained sluggish, keeping the market in an adjustment phase.

4. Persistent Demand-Side Pressure

In the first half of the year, slower growth in infrastructure, manufacturing, and real estate investments weighed on steel consumption. Notably, real estate development investment fell by 11.2% year-on-year, and although the decline in new construction starts narrowed slightly, overall activity remained weak. In manufacturing, automobile production and sales were a rare bright spot, maintaining growth.

5. Steel Output Outpacing Demand Growth

From January to June, China’s crude steel output fell by 3.0% year-on-year, but apparent consumption dropped even more sharply by 5.5%, indicating persistent supply-demand imbalances. Steel exports rose by 9.2%, but export prices fell by 10.3%, reflecting intensifying global competition.

6. Further Decline in Raw Material Costs

In June, prices of key raw materials mostly declined, with metallurgical coke dropping by 9.35% month-on-month and scrap steel falling by 2.12%, adding downward pressure on steel prices.

7. Weakness in Global Steel Markets

The global steel market also remained sluggish, with the CRU international steel price index down 9.7% year-on-year in June. Declines were seen across North America, Europe, and Asia.

8. Key Focus Areas Ahead

The steel industry currently faces multiple challenges, including rising international trade friction, sluggish domestic demand, and inventory reduction pressures. As crude steel production control policies take effect, steelmakers must adjust production schedules and adapt to market changes.

With policy support and market adjustments, the steel market is expected to stabilize gradually in the second half of the year, though short-term volatility is likely to persist.