Today, February 26, news has emerged about China planning to cut crude steel production from 2025 to 2027, bolstering weak market sentiments seen earlier this week. However, most market sources consider the news to be just a rumor at this stage, as no semi-official announcements have been made. As a result, there has been minimal support for local steel prices in China, and export quotations have remained relatively stable.
According to market reports, China is expected to cut its steel production by 50 million metric tons in 2025, by 20 million metric tons in 2026, and by 10 million metric tons in 2027. The rumors also suggest that Li Qiang, a member of the Standing Committee of the Political Bureau of the CPC Central Committee, will sign and formally issue the document next week. In 2024, China's crude steel output totaled 1.00509 billion metric tons, decreasing by 1.7% or 17.38 million metric tons from 2023, according to the NBS. If the rumored 50 million metric ton reduction in 2025 is true, it points to a much larger year-on-year drop.
Despite widespread discussion of these production curbs, there has been no confirmation even in local Chinese media. "It is just a rumor now. I checked DeepSeek [the Chinese artificial intelligence company], and there is still no confirmed news or source for this. The market needed some news; otherwise, it is too slow," a large Chinese trader said. Another trader from China mentioned that the news might become reality, but details will be released later.
The rumors have resulted in a rise in market activity today.
