Key Moments
- China’s steel shipments rose 6.7% in the first 11 months of 2025 to 107.72 million tonnes, as mills pushed exports while domestic construction demand remained weak.
- In contrast, refined aluminium exports fell 9.2% to 5.59 million tonnes over the same period, amid stronger local manufacturing and energy demand.
- Beijing’s informal production ceilings — roughly 1 billion tonnes for steel and 45 million tonnes for aluminium annually — are tightening global supplies and influencing prices.
Steel Exports Surge as Domestic Demand Softens
China’s steelmakers increased shipments overseas this year as local demand cooled, particularly in the property sector. Customs figures show exports of steel products climbed 6.7% to 107.72 million tonnes in the first 11 months of 2025 versus the same stretch in 2024.
Industry observers note that with domestic construction activity subdued, mills have turned to foreign markets to absorb excess output. If December trade follows the annual average, total steel exports for 2025 could approach roughly 117 million tonnes — which would exceed the previous record of 112.39 million tonnes set in 2015.
Meanwhile, Shanghai rebar prices trade near five-year lows. For instance, the contract settled at 3,128 yuan ($442.43) per tonne on Monday, after hovering not far above a June low of 3,012 yuan. As a result, exporting has become a more attractive option for producers, given competitive international pricing — Turkish rebar on the LME last traded around $560.50 a tonne.
Aluminium Shipments Slide as Local Demand Absorbs Output
By contrast, China’s exports of refined aluminium and aluminium products have fallen sharply. Customs data indicate exports fell 9.2% to 5.59 million tonnes in the first 11 months of 2025 as domestic manufacturing and energy-sector demand consumed more metal.
Consequently, London benchmark aluminium prices climbed to $2,920 a tonne on December 5, marking the highest level since May 2022. That contract has jumped about 27% from its early-April 2025 trough near $2,300 per tonne.
Higher prices have notably eased pressure on Western smelters, which have struggled amid rising energy costs. If Beijing maintains the informal annual aluminium cap at 45 million tonnes, global supply is likely to tighten further in 2026.
Production Caps and the Outlook
Beijing has set informal ceilings to help rein in excess capacity: steel production is informally capped at roughly 1.005 billion tonnes and aluminium at about 45 million tonnes. Through October, Chinese steel output stood at 817.87 million tonnes for the first 10 months, implying annual production is on track to finish below 1 billion tonnes for the first time since 2019.
How quickly domestic demand — especially construction activity — recovers will determine whether steel mills continue to rely on export markets. If demand remains weak, producers may keep exporting to preserve cash flow or reduce capacity by retiring older furnaces.
Regional Trade Patterns and Price Effects
Much of China’s steel exports are destined for neighboring Asian markets that lack large domestic steel sectors. These buyers find Chinese steel competitively priced, helping explain persistent export flows despite protectionist measures such as tariffs in some countries.
For aluminium, shrinking export volumes from China combined with stronger local consumption have tightened global market balances. That supply squeeze has been a key driver behind the benchmark price recovery seen since April.
Bottom Line
China’s contrasting export trends in steel and aluminium highlight how domestic demand shifts and policy constraints are reshaping global commodity flows. While steelmakers have been forced to chase overseas buyers amid a property slump, aluminium producers are seeing more metal absorbed at home, lifting prices and easing pressure on higher-cost smelters abroad.
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