When steel is no longer needed at home, China gets it exported!

Contrasting with previous years, when steel exports were seasonally tracking domestic production and trending lower in the second half of the year, steel exports in Aug’23 unseasonably bounced +13% MoM or +35% YoY to record 8.3Mt/mth.

The situation points at a still depressed construction sector in China where local steel groups direct their output outside China in order to keep its domestic steel market balanced. With OECD economies still locked in a desperate fight against inflation, protectionist responses are likely to be muted (except perhaps for India) and the trade is likely to surf on weakening Chinese currency and to flourish in the coming year or so!

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