2025-06-06
The steel market is facing a test of its ability to adjust supply and demand.
Production Data ：
According to statistics from the China Iron and Steel Industry Association, the average daily output of pig iron by key steel enterprises in the lower half of May 2025 was 1.913 million tons, a decrease of 3.5% compared to the previous ten days and a decrease of 9.9% year-on-year; the average daily output of crude steel by key steel enterprises in the lower half of May 2025 was 2.091 million tons, a decrease of 4.9% compared to the previous ten days and a decrease of 12.7% year-on-year; the average daily output of steel by key steel enterprises in the lower half of May 2025 was 2.177 million tons, an increase of 2.5% compared to the previous ten days and a decrease of 11.6% year-on-year.
(Lange Steel Research Center, Ge Xin, 15810671409 (WeChat ID), Please indicate the source when reprinting)
Lange Comments:
From the monthly data of the average daily output of large and medium-sized steel enterprises, the capacity release of large and medium-sized steel production enterprises has shifted from strong to weak. According to statistics from the China Iron and Steel Industry Association, in May 2025, the average daily output of pig iron by key large and medium-sized steel enterprises was 1.962 million tons, an increase of 0.1% month-on-month, a narrowing of the month-on-month growth rate by 3.2 percentage points, and a year-on-year increase of 0.6% (see Figure 1); the average daily output of crude steel was 2.165 million tons, a decrease of 2.0% month-on-month, a shift from increase to decrease month-on-month, and a year-on-year decrease of 1.2% (see Figure 2); the average daily output of steel was 2.128 million tons, a decrease of 0.7% month-on-month, a shift from increase to decrease month-on-month, and a year-on-year flat (see Figure 3).
Figure 1: Ten-day Output of Pig Iron by Large and Medium-sized Steel Enterprises
Figure 2: Ten-day Output of Crude Steel by Large and Medium-sized Steel Enterprises
Figure 3: Ten-day Output of Steel by Large and Medium-sized Steel Enterprises
From the perspective of monthly changes in blast furnace operating rates, the production release of steel enterprises shows a high-level fluctuating trend. According to data from Lange Steel Network, the national average blast furnace operating rate of major steel enterprises in May 2025 was 77.7%, an increase of 0.1 percentage points compared to the previous month's average (see Figure 4); the average daily output of molten iron by 201 production enterprises nationwide was 2.341 million tons, an increase of 12,000 tons compared to the previous month's average. From the perspective of steel mill profits, since May 2025, steel mills have experienced a process from uneven profits and losses to overall losses. According to calculations by the Lange Steel Research Center, by the end of May, the two major steel varieties, calculated based on two weeks of raw material inventory, were in a state of overall loss, with the loss of grade three rebar being nearly 30 yuan and the loss of hot-rolled coil being nearly 100 yuan. Entering June, due to the deepening of the seasonal off-season effect, the production enthusiasm of steel enterprises has shifted from strong to weak, and both the blast furnace operating rate and the average daily output of molten iron have slightly decreased.
Figure 4: Blast Furnace Operating Rate of Major Steel Enterprises Nationwide
In the uncertain global environment, countries are striving to enhance the stability of economic recovery from three aspects: improving supply chain resilience, accelerating technological innovation, and promoting diversified market layouts. At the same time, they should continue to firmly promote multilateral trade cooperation and build a more stable and sustainable economic recovery path. China's economy has withstood pressure and maintained stable growth, continuing its positive development trend, but it still needs to step up efforts to implement various economic stabilization policies and measures, accelerate the construction of a new development pattern of "dual circulation" and a unified national market; promote high-level opening up to the outside world, expand new incremental external demand, strengthen the resilience of economic operation, enhance risk resistance, and ensure the steady and far-reaching development of the macroeconomic economy.
At present, with the deepening of the seasonal off-season effect, the release of terminal demand in the domestic steel market will also be gradually restricted. However, due to the uncertainty of external factors such as Sino-US relations and the frequent appearance of various "small essays," short-term disturbances have been created in the domestic steel market, but this cannot change the impact of the seasonal off-season demand. The market is facing a test of the ability to adjust the "rhythm" of supply and demand. (Lange Steel Research Center, Ge Xin, 15810671409 (WeChat ID), Please indicate the source when reprinting)
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