Morning Bites

🏗China’s excavator sales jumped 36% YoY in May (domestic + export), vs. the +30% YoY in April, per CCMA data. Specifically, domestic sales were up 39% YoY (but still 47% lower than the same period in 2021). In our view, the sales data provide a mildly bullish indicator of the prospects for a recovery in the local property sector in the medium-term

The gradual recovery in Chinese excavator sales, recorded since mid-2024, suggests that local construction activity is slowly bottoming out, in our view. Meanwhile, Beijing plans further cuts to 'excessive' steel output in 2026 (-4% YoY in 5mo26, after -4% YoY in 2025, per the official data). We believe that these two factors might reduce surging Chinese steel exports, and support global steel prices in the medium term

#steel