China Steel Inventories Fall As Rebar Demand Hits A Four-Year Low And Freight Risks Rise

China's steel market remained under pressure during October 19–25, 2026. Inventories of the five major steel products declined for another week, but apparent consumption fell faster than supply. Rebar demand dropped to its lowest level for the same period in nearly four years, while average rebar and hot-rolled coil prices moved lower. Steel mill profitability improved from a very low base, which may slow production cuts and keep supply pressure in the market.

International buyers also faced a more complicated landed-cost environment. Dry-bulk freight strengthened, container rates stayed near high levels, Brent crude briefly reached USD 117.45 per barrel, and new Asian trade-remedy actions affected seamless pipe, prestressed concrete strand and cold-rolled stainless steel.

For the complete price, inventory, raw-material, freight and trade-policy data package, download Promisteel's Weekly Steel Industry Report for October 19–25, 2026.

Key Takeaways for Steel Buyers

• Supply of China's five major steel products declined 0.3% week on week to 7.9205 million tonnes.
• Total inventory fell 2.2% to 14.4775 million tonnes, but apparent consumption dropped 4.5% to 8.2413 million tonnes.
• Rebar apparent demand fell to 2.0103 million tonnes, the lowest level for the same period in nearly four years.
• Steel mill profitability increased 3.03 percentage points to 11.26%, while daily hot-metal output fell to 2.323 million tonnes.
• The SCFI was almost unchanged at 3,681.34, while the Baltic Dry Index rose 5.9% and the Capesize index increased 16.7%.
• India's trade authority recommended extending anti-dumping duties on specified Chinese seamless tubes for another five years.

Steel Inventories Decline, but Consumption Falls Faster

Combined supply of China's five major steel products decreased by 24,700 tonnes to 7.9205 million tonnes. Total inventory fell by 320,800 tonnes to 14.4775 million tonnes, including an 89,300-tonne decline in mill stocks and a 231,500-tonne decline in social inventory.

The inventory reduction looks constructive at first glance, but the demand data are less encouraging. Apparent consumption fell by 390,000 tonnes, or 4.5%, to 8.2413 million tonnes. Construction-steel consumption declined 8.3%, while flat-product consumption dropped 2.4%. The post-holiday restocking pulse faded, and the expected October peak season did not generate a sustained improvement in downstream activity.

Rebar supplied the clearest warning. Apparent demand fell by 212,400 tonnes to 2.0103 million tonnes, the lowest level for the same period in almost four years. Rebar production increased slightly to 1.7473 million tonnes, although it remained near a four-year low. Total rebar inventory declined 4.8% to 5.2216 million tonnes and accounted for more than 80% of the weekly five-product stock reduction.

Hot-rolled coil showed greater supply resilience. Weekly HRC output increased 0.9% to 2.8615 million tonnes as rolling lines in North China restarted. HRC inventory declined only 0.7% to 4.3567 million tonnes, and mill inventory increased slightly even as social stocks fell. Buyers of standard hot-rolled steel therefore retain negotiating leverage, but customised widths, grades and fixed production windows still require earlier planning.

Steel Prices Move Lower as Mill Profitability Recovers

China's national average rebar price fell RMB 8 per tonne to RMB 3,311, while the average hot-rolled coil price dropped RMB 28 to RMB 3,248 per tonne. The main rebar futures contract closed at RMB 3,047, down 0.88%, and Tangshan Qian'an billet declined RMB 20 to RMB 2,920 per tonne.

Blast-furnace operations also softened. The operating rate at 247 surveyed mills declined 0.09 percentage points to 80.42%, hot-metal capacity utilisation fell to 87.23%, and average daily hot-metal output decreased to 2.323 million tonnes. Lower hot-metal output weakens immediate demand for iron ore and coke.

At the same time, the share of profitable mills rose 3.03 percentage points to 11.26%. Lower coke and iron-ore costs helped repair margins, although profitability was still 36.36 percentage points below the level recorded one year earlier. Better margins can reduce the urgency for maintenance or output cuts, so the recovery in profitability is not automatically bullish for finished-steel prices.

For procurement teams, the current market favours staged purchasing. Standard commodity grades can be covered in smaller tranches while demand remains weak. Project-critical specifications, certified material and processed orders should be booked against confirmed production schedules rather than delayed solely in expectation of a lower headline market price.

Iron Ore and Coking Coal Provide Limited Cost Support

Imported iron-ore inventory at 47 Chinese ports fell by 942,000 tonnes to 172.7497 million tonnes, ending five consecutive weeks of stock accumulation. The 45-port measure dropped by 995,400 tonnes to 164.3513 million tonnes. Daily port offtake remained high but declined to 3.2817 million tonnes.

Despite the inventory draw, iron-ore pricing remained weak. The main domestic futures contract closed at RMB 669, down RMB 16, while Singapore iron-ore swaps fell below USD 90 per tonne for the first time in two years. The stock decline may offer short-term support, but lower steel output and high absolute port inventory continue to limit the upside.

Coking coal weakened more sharply. The main contract fell 6.6% to RMB 1,384.5 as mine restarts in Shanxi progressed and Mongolian coal customs clearance recovered to around 755 trucks. Coke producers proposed their first price increase after two rounds of cuts, but mills postponed acceptance. Easing raw-material costs support mill margins while reducing the cost floor under finished steel.

China's September Steel Output Stabilises, but Investment Remains Weak

China produced 73.59 million tonnes of crude steel in September, up 0.1% year on year. January–September output reached 724.77 million tonnes, down 2.9%, according to the National Bureau of Statistics.

The demand-side macro picture remained difficult. National fixed-asset investment excluding rural households fell 7.2% in the first nine months of 2026. Property-development investment declined 20.6%, while infrastructure investment decreased 4.2%, according to the official investment release. These figures help explain why construction steel did not receive the expected October demand boost.

Inflation increased at the same time. September CPI rose 0.9% year on year and PPI increased 5.0%. Higher producer prices partly reflected energy and industrial input costs, adding pressure to manufacturers even though demand for several steel-intensive sectors remained uneven.

Freight Markets Diverge as Capesize Rates Rebound

The Shanghai Containerized Freight Index edged up only 0.05% to 3,681.34 on October 23, its third consecutive small weekly increase. The Europe rate rose 0.28% to USD 3,557 per FEU. US West Coast freight eased 0.05% to USD 7,521 per FEU, while US East Coast freight fell 0.16% to USD 10,368 per FEU.

Dry-bulk shipping moved more decisively. The Baltic Dry Index rose 5.9% to 2,660, recording a second consecutive weekly gain. The Capesize index jumped 16.7% to 3,791, with average Capesize earnings at USD 30,877 per day. Mine-supply disruptions and improved iron-ore and coal cargo activity supported the larger vessel segment. By contrast, the Panamax index fell 8.9% to 2,109 as grain and coal cargoes weakened.

Steel buyers should not use one freight benchmark for every order. Finished pipes, profiles, coils and sheets may move by container or breakbulk service, while iron ore and coal are exposed to dry-bulk conditions. Route, cargo form, vessel type, loading window and port handling can move in different directions.

Trade Remedies Raise Risk for Seamless Pipe and Steel Products

India's Directorate General of Trade Remedies completed its second sunset review of specified seamless tubes, pipes and hollow profiles from China. The authority recommended extending anti-dumping duties for another five years, with a nil rate for Jiangsu Chengde Steel Tube Share Co., Ltd. subject to the stated conditions and USD 268 per tonne for other covered Chinese producers and exporters. The recommendation and final-findings document are available from the official DGTR case page.

The distinction between a final review finding and customs collection is important. Buyers should confirm when and how the recommendation is implemented, whether their product falls within the scope, and which producer rate applies before finalising Indian landed-cost calculations.

The weekly report also records a Thai anti-dumping investigation into Chinese prestressed concrete steel strand, with an alleged dumping margin of 7.83% of CIF value. Vietnam's trade authority accepted a petition involving cold-rolled stainless products from China, Indonesia and Taiwan, with a decision on formal initiation expected later. These proceedings increase uncertainty for Asian sales of pipes, wire products and stainless flat steel.

Buyers of steel pipes,

cold-rolled steel and structural products should verify HS codes, technical scope, producer or exporter rates, country of origin, mill certificates and documentary requirements before approving a quotation. The lowest FOB price is not necessarily the lowest landed cost.

Oil and Hormuz Risk Increase Delivery-Cost Volatility

Brent crude settled at USD 116.72 per barrel on October 23 after reaching USD 117.45 intraday, gaining more than 6% during the week. The move followed renewed concern about shipping security near the Strait of Hormuz. Iranian state television reported that seven tankers were attacked or struck mines, while independent verification varied. The price movement and security context were reported by the Associated Press.

For steel procurement, the commercial impact extends beyond crude oil. Higher bunker fuel, war-risk insurance, vessel premiums, rerouting and port delays can change the delivered cost after the steel price has been agreed. Gulf-related quotations should separate steel value, freight, insurance and local charges, each with an appropriate validity period.

What Week 43 Means for Steel Buyers

China's continued inventory decline does not yet confirm a strong market recovery. Consumption weakened faster than supply, rebar demand reached a multi-year seasonal low and mill profitability improved enough to reduce the incentive for deeper production cuts. Steel prices may therefore remain under pressure even as raw-material and freight markets create intermittent cost support.

• Cover confirmed near-term demand in stages rather than making a large directional inventory bet.
• Track apparent consumption and mill production alongside inventory; destocking alone can overstate market strength.
• Reserve specialised grades, dimensions, testing and processing slots early even when standard material remains negotiable.
• Use route-specific freight and insurance validity, particularly for Gulf-related or breakbulk steel shipments.
• Complete trade-remedy scope, producer-rate, origin and documentation checks before confirming pipe, wire or stainless orders.

For the complete weekly indicator set and detailed tables, download the Promisteel Weekly Steel Industry Report for October 19–25, 2026.

Promisteel monitors steel prices, mill operations, logistics and trade-policy changes to help international customers make better sourcing decisions. Our product range includes coils, sheets, structural steel, pipes and tubes for construction, manufacturing, energy and industrial projects.

Contact the Promisteel team to discuss product availability, shipment planning or destination-market compliance.

Data summarized in the linked weekly report include information from Mysteel, China's National Bureau of Statistics, the Shanghai Shipping Exchange and the Baltic Exchange. Trade-policy and macroeconomic details were checked against official sources where available. This article is for B2B market reference only and does not constitute investment or legal advice.