Morning Bites (part 2)

🔗Global crude steel output declined 2% YoY in April to 153mnt, after the 4% drop YoY in March, World Steel Association (WSA) data show. China’s production (~50% of global crude steel supply) decreased 3% YoY, while world ex-China output also inched down 1% YoY, per the WSA numbers. Specifically, the data show that Russian and EU output dropped 12% and 2% YoY, respectively, last month, but the US production increased 9% YoY and Indian output (~10% of global steel supply) gained 4% YoY (also up 9% YoY in 4mo26)

Given the ongoing weakness in the global steel market, we believe that Beijing might continue to tighten supply on a gradual basis. Specifically, in mid-May, China’s Ministry of Industry and Information Technology released a tougher steel capacity swap plan to curb oversupply: now at least 1.5t of old steel capacity needs to exit to build ⁠every 1.0t of new capacity nationwide

#steel