Morning Bites (part 1)

🔗China’s net finished steel exports were up 28% YoY in July, after the 13% YoY gain in June, amid persistently soft domestic demand. To recap, the Chinese authorities are considering cutting local steel output in 2025, in an attempt to restore market balance and profitability at mills. Although the measure’s size was not specified, market participants expect China’s steel supply to decline 2-5% YoY this year. On our numbers, a 2-3% output cut could normalise abnormal Chinese net export volumes (which grew 25% YoY in 2024 and 13% YoY in 7mo25)

🪨China’s coal imports dropped 23% YoY in July, vs. the 26% YoY decline in June, as ample domestic supply limited import demand. According to Reuters, the MoM improvement is due to hotter weather, which spurred higher air conditioning demand, supporting electricity consumption. Noteworthy, potential government inspections in China's major coal production hubs might lead to supply disruptions, reducing pressure on import volumes

#coal #steel