Steel Industry 2025: Interweaving of Production Cuts and Market Uncertainties

Outlook for the Steel Industry in 2025: Independent Production Cuts Become the Norm, with Fluid Market Changes

It is expected that China's crude steel output in 2025 will further decrease by 2% to 4% based on 2024 levels, equivalent to a reduction of 20 to 40 million tons. Overall steel demand is expected to approach zero growth or show a slight positive growth of around 1%.

Steel prices in 2025 will generally bottom out and rebound. The bottoming-out period is likely to occur around the middle of the second quarter, while the rebound in the second half of the year will depend on whether domestic investment and consumption can emerge from the shadow of deflation.

China's steel exports hold the most promise for driving growth but are vulnerable to trade disputes. If cooperation with partner countries outside North America is strengthened, exports may reach a new level.

As the transformation and upgrading of the manufacturing industry enters a deeper phase, steel producers should accelerate product transformation and establish closer partnerships with downstream enterprises. Industry competition is shifting from quantity to efficiency, making profit preservation a key priority. Domestic steel producers will implement independent production cuts more frequently.

In 2025, global trade tensions may resurface. Exploring strategies to export inflation to specific countries could serve as a response to additional tariffs. The operational approach for 2025 should focus on medium-to-long-term factors: patiently waiting for low-cost and high-yield opportunities, and exiting when timing or magnitude thresholds are met. Exit strategies should align with high-end investment tactics.