Between January and June of this year, China's steel industry showed an obvious structural pattern. divergence, characterized by the fact that raw materials have better characteristics than finished steel, high-quality and special steel is superior to ordinary steel, flat rolled products perform better than long rolled products, and steel pipes show the largest reduction.
Mr. Wang said the rapid introduction of new policy-based financial instruments of 800 billion yuan (118 billion U.
S. dollars) could help boost demand for commodities, leading to a recovery trend in steel prices in the second half of the year.
At the same time, the supply and demand situation in the steel market is expected to improve in the second half of the year. Accordingly, steel prices may stabilize and recover. The average price of finished steel is expected to be slightly higher than in the first six months of this year.
In the period from July to December, the process of reducing stocks of coking coal and coke will continue, and iron ore supplies will increase, although year-on-year growth may slow down. However, crude oil prices may rise and reach high levels, leading to higher commodity prices.
Throughout 2026, China's economic development will strive for progress while maintaining stability. Worldwide, steel supply will be high, while demand will remain relatively sluggish, leading to oversupply and having a negative impact on steel prices.
Supply constraints in China are expected to intensify in the second half of the year amid political constraints, enterprise self-discipline and production controls, as well as market pressure forcing steelmakers to reduce production, which will help reduce inventories.
In the remaining six months of this year, China's economy is likely to recover, with improved liquidity, which will have a positive impact on replenishing customer stocks. According to Wang's forecast, with neutral expectations, the cumulative average steel price in China in 2026 may show a slight increase of 1.7 percent.
