Morning Bites (part 2)

🔗Global crude steel output was broadly flat YoY in May at 158mnt, after the 2% YoY drop in April, World Steel Association (WSA) data show. China’s production (~50% of global crude steel supply) decreased 3% YoY, while world ex-China output was up 2% YoY, per the WSA numbers. Specifically, the data show that Russian output dropped 5% YoY, while EU production remained flat YoY last month. US production jumped 9% YoY and Indian output (~10% of global steel supply) gained 2% YoY (being up 8% YoY in 5mo26)

Given the ongoing weakness in the global steel market, we believe that Beijing might continue to tighten supply on a gradual basis. Specifically, in 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