The intensity of "snatching exports" of steel continues to increase

Entering 2025, the export of steel across the country has shown sustained strong growth. The latest statistics from the General Administration of Customs show that from January to July 2025, the country exported 67,983,000 tons of steel, a year-on-year increase of 11.4%. Among them, in July, steel exports reached 9,836,000 tons, a year-on-year increase of 25.7%, with a significantly higher growth level. Based on this calculation, the annual export volume of steel is estimated to be around 100 million tons, maintaining a large quantity scale.

Steel exports also remained robust during the same period. According to data from the General Administration of Customs, China's exports of machinery and electrical products reached 9.18 trillion yuan in the first seven months, marking a 9.3% year-on-year increase. This segment accounted for 60% of total exports, up more than one percentage point from the same period last year. Among these, exports of high-end equipment-which consume significant amounts of steel—surged by over 20% year-on-year. Meanwhile, the nation's automobile exports grew by 10.9% year-on-year during the first seven months of this year.

For some time, trade protectionism has risen in countries around the world, particularly with the U.S. Trump administration's maximum pressure tactics and the launch of a "tariff war," creating significant uncertainty in global steel trade and its prospects. However, in this severely deteriorated export trade environment, China's steel exports (including indirect steel exports, the same below) have grown substantially against the trend, continuously setting new historical highs. One important driving force behind this lies in the U.S. Trump administration's "tariff war" and the resulting significant uncertainty in global steel trade and its prospects, which instead has spurred unprecedented "snatching exports" dynamics among countries worldwide, triggering a global "forward demand" effect for Chinese steel. Moreover, due to several extensions of the "high tariffs" by the U.S. Trump administration during its effective period, the time for this "snatching exports" has been extended, prolonging the forward demand effect of China's steel exports— whether direct or indirect—what might be termed "both the failure and the success stem from the same source."

The "snatching exports" has brought forward export demand, directly expanding China's total steel demand in the current period and becoming a strong engine for the growth of China's total steel demand this year. It is precisely for this reason that the supply-demand relationship for steel in China has improved to a certain extent in the current period, and has become a major factor contributing to the significant increase in profits of Chinese steel producers in the first half of this year. The total profit of key steel statistics enterprises in the China Iron and Steel Association in the first half of this year amounted to 59.2 billion yuan, a year-on-year increase of 63.26%.

It should be noted that the recent surge in China's steel exports and the forward-looking external demand for steel, in a sense, are merely a "spatiotemporal transformation" of the predetermined demand volume. In other words, the current surge in exports and the forward-looking external demand, given the fixed overall external demand, imply a weakening of future exports and the need to digest the time spent hoarding steel through exports. It follows that as the actual implementation period of high tariff barriers arrives, the effectiveness of export surges will decline sharply. In the future, both direct and indirect steel exports from China will face significant downward risks. At that time, the volume of steel exports and the growth rate may experience a substantial decline, with the possibility of negative growth in some months not being ruled out. Under its influence, the supply-demand dynamics, price trends, and profit levels of domestic steel markets will all suffer a certain negative impact.