Domestic steel inventories remained at a recent low in the first half of the year.

Zhao Minge, President of the China Iron and Steel Association, presented the basic situation of the steel industry in the first half of the year at the 11th (Expanded) Meeting of the Sixth Council of the China Iron and Steel Association. Thanks to the effective production control measures implemented by the state to achieve a dynamic balance between supply and demand, increased industry self-regulation and production control, and steel companies' active exploration of new production and operation models, steel production decreased year-on-year in the first half of the year, while industry profits rebounded reasonably.

According to Zhao Minge, steel production decreased year-on-year, while inventories remained at a recent low. According to data from the National Bureau of Statistics, in the first half of the year, national crude steel output reached 515 million tons, a year-on-year decrease of 3.0%, in line with the expectations and requirements of national industrial regulation policies. This translates to apparent crude steel consumption of 452 million tons, a year-on-year decrease of 5.6%. Among these, the output of hot-rolled sheet and strip and coated steel sheets saw rapid year-on-year growth, and steel product varieties have been continuously optimized to actively adapt to the national industrial structure adjustment. According to monitoring by the China Iron and Steel Association, the average monthly end-of-month steel inventory at key steel enterprises in the first half of the year was 18.91 million tons. The figures for the same periods in 2022, 2023, and 2024 were 20.33 million tons, 20.88 million tons, and 20.56 million tons, respectively. "Since the beginning of this year, enterprises have been experiencing smooth production and sales, and steel inventories are at their lowest level in nearly four years. However, overall, steel supply remains stronger than demand."

Reflecting this in terms of prices, the China Steel Price Index (CSPI) averaged 93.75 points in the first half of the year, a year-on-year decrease of 13.35%. However, the overall price trend remained relatively stable. According to reports, steel prices fluctuated downward in the first half of the year, with the largest fluctuation reaching 7.47 points, the smallest fluctuation in the past five years.

"Since the beginning of this year, steel inventories have remained low, laying the foundation for stable steel prices." Zhao Minge added, but it is worth noting that in June, steel inventories of key statistical enterprises showed an upward trend, with a year-on-year increase of 5.2% in late June. During the same period, steel prices fell. At the end of June, the CSPI fell to 89.51 points, a new low in nearly eight years. He said that stabilizing the market remains the top priority and must not be relaxed.