FX.co ★ Steel Falls on Potential Output Curbs

Steel rebar futures slipped to around CNY 3,130 per ton, retreating from recent highs after China’s major steelmaking center, Tangshan, activated a level-two emergency response to severe air pollution. The move has heightened concerns about potential output cuts and stricter environmental inspections.

Industry data showed that Chinese steel production fell 3.6% in February to 76.1 million tons, while global output declined 2.2% to 141.8 million tons. At the annual parliamentary meetings in Beijing earlier this month, authorities reiterated their commitment to cutting excess capacity in the steel sector amid softening demand.

China’s steel industry continues to grapple with structural headwinds as the economy matures, with weaker construction activity further pressured by a prolonged property downturn. Total steel output dropped below 1 billion tons last year for the first time since 2019.