Morning Bites (part 1)

🔗CISA mills daily crude steel production in late December was 1.64mnt, down 10.9% from the previous ten days and also 12.2% lower YoY. Meanwhile, local steel inventories fell 11.7% over the period, but were 14.3% higher YoY

According to the CISA data, in 2025 local production slid 1.2% YoY. However, the official NBS data showed the country's steel output down 4.0% YoY in 11mo25, while Chinese net export volumes (which grew 25% YoY in 2024 and 7% YoY in 11mo25) remain high

To recap, in late October, China held a plenum meeting regarding its 2026-30 strategic industries plan (details to be released in March 2026). Given the ongoing crisis on the global steel market, Beijing might introduce additional strict supply-control measures similar to the 2016-17 reform (when >100mnt of steelmaking capacities was removed). The new reform, if announced, might trigger a recovery in global steel prices in 2026, we believe

China accounts for ~57% of global steel supply

#steel