According to the Steel Industry PMI survey released by the China Federation of Logistics & Purchasing’s Steel Logistics Professional Committee, the index stood at 50.6% in March 2026, marking a month-on-month increase of 3.9 percentage points. After remaining below 50% for seven consecutive months, the index has returned to the expansionary range, indicating that as the impact of the Spring Festival gradually fades, the steel industry is returning to positive growth and business sentiment is improving. Changes in the sub-indices show that both supply and demand in the steel sector are recovering simultaneously. The depletion rate of finished goods inventory has accelerated further, while prices for both raw materials and steel products have risen. It is expected that in April, the steel industry will maintain a stable and positive operating trend, with market demand recovering and improving, steel mill production remaining stable with moderate growth, and prices for raw materials and steel products still having room to rise.

Pan Fujie, Director of the Steel Logistics Specialized Committee of the China Federation of Logistics & Purchasing, commented: In March, the steel industry shook off the seasonal disruptions caused by the Spring Festival holiday, with industry sentiment rebounding and overall operations moving steadily in a positive direction. On the demand side, downstream construction sites and manufacturing enterprises fully resumed work and production, leading to a noticeable recovery in steel demand and increased procurement at the end-user level; however, the export sector remained relatively weak. On the supply side, environmental production restrictions during the heating season were gradually lifted. Coupled with the recovery in downstream demand, steel mills accelerated their production pace. As steel mills released concentrated restocking demand, raw material procurement activity heated up significantly, driving raw material prices to rise strongly overall. Driven by both demand and rising costs, steel prices fluctuated upward. As the traditional peak consumption season continues to deepen, downstream demand is expected to be further unleashed, and the steel industry will maintain a stable and positive operating trend.

Steel demand has shown a marked recovery, while export orders remain relatively weak. In March, as the impact of the Spring Festival holiday gradually faded and temperatures steadily rose across the country, construction sites and manufacturing enterprises resumed operations, outdoor construction work gradually resumed, infrastructure projects gained momentum early on, physical work volume continued to accumulate, and the effects of policies promoting equipment upgrades in the manufacturing sector continued to take effect, leading to a significant recovery in domestic steel market demand. The New Orders Index stood at 51.2%, up 10.9 percentage points month-on-month, marking an eight-month high. However, export orders remained weak. This is attributed to two factors: first, the phasing-out of the temporary adjustment effect following the implementation of new steel export licensing policies; second, the direct impact of geopolitical conflicts, intensified international trade frictions, and tightening demand in certain regions on China’s steel export orders, causing pressure on steel exports to resurface. The new export orders index stood at 39.6%, down 10.1 percentage points month-on-month. Regarding end-user demand, according to Shanghai Zhuogang Chain, domestic demand in March saw an overall recovery following the holiday period, though the pace was relatively slow. Taking the procurement of rebar and wire rod by end-users in the Shanghai market as an example, March saw a 98% month-on-month increase—a significant rise. However, aside from the normal recovery of end-user demand, another key factor was the low baseline from the previous month.

Steel mill production rebounded significantly, and inventory drawdown accelerated while remaining stable. In March, as the impact of the Spring Festival largely subsided, downstream end-user demand continued to recover, and environmental production restrictions during the heating season were gradually lifted. Steel mills gradually increased their production capacity, and industry production activity accelerated markedly. The steel industry production index stood at 53.3%, up 6.5 percentage points month-on-month, returning to the expansionary range for the first time in seven months. Data from the China Iron and Steel Association (CISA) shows that in early March, key steel enterprises produced an average of 2.011 million tons of crude steel per day, up 3.3% from the same period last month; average daily pig iron production was 1.821 million tons, up 2.8% from the same period last month; and average daily steel product output reached 1.845 million tons, up 5.2% from the same period last month. By mid-March, key steel enterprises’ average daily crude steel output stood at 2.027 million tons, remaining largely unchanged from the previous month; average daily pig iron output was 1.814 million tons, down 1.6% from the same period last month; and average daily steel product output was 1.984 million tons, up 4.4% from the same period last month, indicating an overall steady upward trend. As market demand continued to pick up in the second half of the month, steel mills maintained ample order volumes, and production continued its steady upward trend. It is worth noting that the current rebound in demand has been robust. Against the backdrop of steadily rising production, the pace of finished goods inventory drawdown has accelerated slightly. The finished goods inventory index stood at 43.7%, down 1.6 percentage points month-on-month, remaining in the contraction zone for two consecutive months.

Raw material procurement has picked up significantly, and raw material prices have risen markedly. In March, as market demand picked up and steel mills accelerated production, raw material procurement activity received a significant boost. The procurement volume index stood at 60.3%, up 18.5 percentage points month-on-month, reaching an eight-year high. This indicates that steel mills’ demand for raw material restocking was concentrated in March, leading to a significant surge in procurement activity. Consequently, raw material prices ended their previous weak trend and began an upward trajectory, with the purchase price index reaching 68.5%, a substantial month-on-month increase of 23.3 percentage points. By product category, iron ore prices rose, supported by concentrated restocking by steel mills and sustained strong demand; scrap steel prices increased compared to the previous month, driven by the full resumption of production at electric arc furnace steel mills and a surge in demand; coking coal and coke prices rose as a result of tight supply-demand dynamics and robust downstream procurement demand. Overall, prices for all raw material categories showed an upward trend.

Steel prices fluctuated upward. In March, overall demand in the domestic steel market showed a recovery trend, driving market prices to fluctuate at relatively strong levels. The Shanghai rebar price index indicates that the price on March 2 was RMB3,105 per ton, marking the month’s low. Prices subsequently fluctuated upward, reaching a monthly high of RMB3,169 per ton on March 23. Although prices then retreated slightly, the overall trend remained upward.

It is projected that in April, steel demand will show a steady recovery and continue to improve. Current market demand has a solid foundation for consolidation. First, as temperatures rise nationwide, outdoor construction conditions continue to improve, and downstream construction sites resume full operations, procurement demand for related steel products will continue to increase. Second, utilization rates in the machinery, automotive, home appliance, and new energy sectors remain at high levels. As earlier orders are gradually fulfilled and the effects of policies promoting equipment upgrades in manufacturing continue to take hold, enterprises’ willingness to expand production is steadily increasing. Third, policy measures will inject stronger momentum into the steel industry. As the infrastructure sector serves as the core driver for stabilizing growth in the opening year of the 15th Five-Year Plan, funds from special bonds issued in advance will continue to be disbursed and put into use. The “Six Networks” initiative, along with infrastructure in key sectors, public service facilities, and major livelihood projects, will be fully implemented. A moderately loose monetary policy will continue to take effect, providing ample financial support for project construction. This will accelerate the accumulation of physical work volume, forming a sustained and robust core support for steel demand. Overall, it is projected that in April, although the bottoming-out and adjustment of the real estate market will have limited impact on demand, the foundation for demand recovery will gradually solidify. Driven by multiple factors—including sustained momentum in infrastructure investment, steady support from manufacturing demand, and strengthened policy stimulus—steel demand is expected to continue its recovery trend, presenting a steady and improving operational outlook. It should be noted that regarding exports, steel exports still face certain pressures due to weak overseas market demand and rising uncertainties in the international trade environment.

Steel mill production is expected to grow steadily. In April, with the full withdrawal of environmental production restrictions during the northern heating season, production operations at steel mills that resumed earlier will fully normalize, further opening up room for capacity utilization. At the same time, the recovery and improvement in market demand will significantly boost steel mills’ willingness to produce. Overall, steel mill production is expected to maintain a steady growth trend.

Prices for raw materials and steel products may still have room to rise. In April, the steady yet slightly increasing production at steel mills is expected to drive sustained demand for key raw materials such as iron ore, coke, and scrap steel. Coupled with geopolitical conflicts disrupting the international commodities market, raw material prices are likely to continue their upward trend. At the same time, as demand in the steel market continues to grow and trading activity becomes more vibrant—driven by rising costs—steel prices are also expected to maintain an upward trajectory.　　

SunSirs has been continuously tracking price data for over 200 commodities for nearly 20 years, please contact support@sunsirs.com for subscription.