Morning Bites

🔗Global crude steel output declined 1.2% YoY to 144.2mnt in August, vs. the broadly flat YoY dynamics seen in July, according to World Steel Association (WSA) data. China’s production (~52% of global crude steel supply) fell 3.7% YoY to 74.6mnt, implying that world ex‑China output grew roughly 1.8% YoY. Specifically, in August, moderate production gains were recorded in India (+4.6% YoY) and the US (+3.0% YoY), while Russia’s output was broadly unchanged (-0.3% YoY), per the WSA data

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

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