Half Year Report on Bearing Steel: Domestic Bearing Steel Market Prices may First Fall and then Rise in the Second Half of 2025

Half Year Report on Bearing Steel: Domestic Bearing Steel Market Prices may First Fall and then Rise in the Second Half of 2025

Overview: Looking back at the first half of this year, the cost of bearing steel market has loosened, and the price center of bearing steel has declined. The bearing steel market is struggling to balance in the "weak supply, weak demand" situation. As of now, the absolute price index of bearing steel is 4925 yuan/ton. So what is the fundamental situation of the domestic bearing steel market in the second half of 2025? The author will provide a brief analysis based on the current market situation.

Ⅰ Review of the National Bearing Steel Market in the First Half of 2025

1. Market price trend of bearing steel

Since 2025, the price trend of bearing steel in China's market has shown a characteristic of "stabilizing first and then decreasing, with a narrower amplitude". According to Figure 1, since 2025, the highest absolute price index of domestic bearing round steel has been 4970 yuan/ton (January 2025), and the lowest average price has been 4914 yuan/ton (May 2025), with a difference of 56 yuan/ton. Looking at it in stages, the overall fluctuation and weakening of bearing steel in mid January and February, coupled with the market experiencing the Spring Festival holiday and weak downstream demand, traders mainly focus on destocking, resulting in a downward pressure on bearing steel prices. Especially in the northern market, the impact of holiday shutdowns is more significant, while in the southern market, due to stable supply chains, price fluctuations are relatively small. From late February to May, the market price of bearing steel showed a characteristic of "first suppressing and then stabilizing, and structural differentiation intensified". 3. In April, due to the slow recovery of terminal demand and weakened cost support, the price of bearing steel fluctuated and weakened. At this time, the differences between the north and the south are gradually becoming apparent. The inventory in the southern market is reduced due to the maintenance of some mainstream steel mills, while the prices in the north are under pressure due to weak demand. The seasonal rebound in demand in May drove prices to stabilize, but the rebound was weak. In June, the cost of chromium based raw materials stabilized, but downstream price pressures led to a narrowing of profits, a reduction in social inventory, and weak and stable market prices.

2. The mainstream market price trend of bearing steel

The price difference between the north and south remained stable at around 100 yuan/ton from January to March; In April and May, due to weak demand in the north, the price difference of mainstream varieties widened to 150-200 yuan/ton; The off-season market in June and the southern rainy season suppressed demand, resulting in a narrowing of price differences.

Ⅱ Review of Bearing Steel Supply in 2025

According to statistics from the Special Steel Association, the crude steel production of bearing steel by major special steel enterprises in China from January to May 2025 was 2.0739 million tons, a decrease of 5.22% compared to the same period last year; The production of bearing steel by major special steel enterprises in China from January to May 2025 was 1.5494 million tons, an increase of 6.83% compared to the same period last year.

Ⅲ Downstream industry

1. Automotive industry

According to research data, from January to May 2025, the production and sales of automobiles reached 12.826 million and 12.748 million respectively, an increase of 12.7% and 10.9% year-on-year. In terms of exports, a total of 2.85 million vehicles were exported from January to May, a year-on-year increase of 16.8%. The automobile market continues to show a good trend, with production and sales increasing by more than 10% compared to the same period last year, and both domestic demand and exports have performed well. Among them, the passenger car market has shown active performance, the commercial vehicle market still needs to recover, new energy vehicles continue to grow rapidly, and the growth rate of automobile exports has significantly increased. The proportion of raw material inventory decline in sample enterprises in the automotive industry is about 9.93%. The overall daily consumption and available days of raw materials in the industry have both declined. Currently, the automotive industry has high market saturation, significant pressure to reduce inventory, and average market sentiment. If favorable policies are intensified in the later stage, coupled with the accelerated pace of product updates and upgrades by car companies, the consumption of bearing steel may steadily increase.

2. Four major household appliances

Research data shows that the cumulative production of air conditioners in China from January to May was 134.909 million units, a year-on-year increase of 5.9%; The cumulative production of refrigerators in China from January to May was 40.713 million units, a year-on-year decrease of 1.5%; The cumulative production of washing machines in China from January to May was 49.115 million units, a year-on-year increase of 9.3%; The cumulative production of color TVs in China from January to May was 75.493 million units, a year-on-year decrease of 4.9%; In terms of exports, China exported a total of 36.46 million air conditioners from January to May, a year-on-year increase of 12.9%; From January to May, a total of 33.64 million refrigerators were exported, a year-on-year increase of 4.0%; From January to May, a total of 14.03 million washing machines were exported, a year-on-year increase of 4.0%; The cumulative export of LCD TVs from January to May was 40.72 million units, a year-on-year increase of 0.2%.

Overall, the current home appliance industry is undergoing a period of deep adjustment characterized by a shift in growth rate and structural optimization. In the short term, we need to anchor the sprint window for the second and third quarters amidst the challenges of high base pressure and diminishing policy effects. We need to stabilize the fundamentals through expectation management, rhythm control, and competition logic restructuring.  In the long term, we need to use AI technology penetration and aging adaptation as strategic pivot points. At present, the price suppression by home appliance factories has put pressure on the profits of bearing steel mills, and downstream procurement strategies are mainly cautious, inclined to choose low prices, small batches, and multiple purchases, actively maintaining a low inventory state. Moreover, the market has a strong wait-and-see sentiment, and it is expected that short-term pressure on bearing steel sales will still exist.

Ⅳ Market outlook for the second half of the year

Macroscopically, financial data as of May shows that China's M2 supply increased by 7.9% year-on-year. But the supply of funds is more aimed at promoting the development of advantageous key industries, boosting the consumer market, and slowly resolving local debts.

On the supply side: According to research data, the crude steel production of bearing steel by major special steel enterprises in China from January to May 2025 was 2.0739 million tons, a decrease of 5.22% compared to the same period last year; The production of bearing steel by major special steel enterprises in China from January to May 2025 was 1.5494 million tons, an increase of 6.83% compared to the same period last year. From this, it can be seen that steel mills have improved their production efficiency by optimizing their processes. In June, the production of bearing steel by major special steel enterprises in China was 405500 tons, an increase of 2.09% compared to the previous month. It can be seen that the overall supply of bearing steel is still at a medium to high level within the year.

On the demand side: With the rapid growth of new energy vehicles, wind power equipment, and aerospace applications, the amount of bearing steel used has increased, and quality requirements have become increasingly strict. In the midst of summer, domestic household air conditioning sales in the downstream sector have entered a peak season. However, in terms of order volume, the current production saturation in the home appliance industry is still acceptable, and low-end bearing steel may show a situation of oversupply, while high-end bearing steel performance may be worth looking forward to.

Overall, the bearing steel market struggled to balance between weak supply and weak demand in the first half of the year, with prices continuing to decline due to cost loosening and external tariff impacts. In the second half of the year, the third quarter may be affected by the rainy season, which may suppress the efficiency of manufacturing operations, resulting in tight orders and pressure on prices. In the fourth quarter, with the favorable policies taking effect, infrastructure treasury bond landed and the fourth quarter was in the peak sales season of manufacturing industries such as automobiles, or with a wave of upward momentum. It is expected that the price of bearing steel will show a trend of "first falling and then rising" in the second half of the year.