BEIJING- Steel demand in China, the world’s largest producer and consumer, will likely flatten or dip slightly in 2025, industrial officials said, warning mounting risks facing steel exports due to growing trade frictions.
Oversupply due to demand dropping faster than supply has weighed down steel prices and hurt profitability among steelmakers, some of which shipped more cargoes abroad.
China’s apparent steel consumption in the first three quarters of 2024 slid 6.2 percent year-on-year to 688 million metric tons, the state-backed China Iron and Steel Association (CISA) told reporters on Friday.
Consumption will likely be below 900 million tons this year, and will stay at around 800 million tons until 2035, the CISA said in a separate note on its WeChat account on Thursday.
China’s crude steel output for the first three quarters slipped 3.6 percent on the year to 768.48 million tons, official data showed last week. CISA forecasts this year’s total output is likely to stay above 1 billion tons.
China’s steel output has been on the decline since 2021 when Beijing started to mandate a cap on annual growth to limit carbon emissions.
The structural focus of China’s steel consumption has shifted to the manufacturing sector, said the CISA.
A protracted downturn in the property market, typically the largest steel consumer in China, has seen Chinese steelmakers struggling with profitability amid dwindling demand.
“Steel demand from the manufacturing sector will climb to around 50 percent or even higher this year,” said Jiang Wei, the association’s vice chairman and secretary general.
Additionally, the association said the concentration in China’s steel industry still lagged some other developed countries.
In the first three quarters of this year, the market share of China’s top 10 steel producers was 40.9 percent, while the share of the top two to four steelmakers in other developed countries ranged from 65 percent to 85 percent, said Wang Bin, another official from the association.
Meanwhile, China’s grain output is set to exceed a record 700 million metric tons this year, a key agriculture ministry official said on Friday, calling for continued efforts to ensure stable supply.
That figure is 0.7 percent higher than the 2023 harvest of 695.41 million tons, data from the National Bureau of Statistics showed.
