China Reduced Steel Production by 9.2% in June 2025

Steel Output in China Falls Sharply Amid Demand Slump

China reduced steel production by 9.2% year-on-year in June 2025, totaling 83.2 million tons, according to official data. This marks the third straight monthly decline and signals deepening challenges for the world’s largest steel-producing nation. Month-on-month, production also slipped by 3.9%, underscoring the fragile state of both domestic demand and operational conditions.

The first half of 2025 saw total Chinese steel output fall 3% from the same period in 2024, reaching 514.8 million tons — the lowest since 2020. The prolonged real estate downturn continues to shrink construction demand, which remains a core driver of steel consumption in China. Additionally, this summer’s extreme heat has disrupted project timelines and limited on-site activity across the country.

Beyond weather and market dynamics, Beijing has intensified its crackdown on overproduction and industrial deflation. Authorities are urging steel mills to limit capacity in key hubs like Tangshan to improve air quality ahead of the upcoming September military parade. This aligns with broader efforts to rebalance supply and cut emissions in the heavy industry sector.

Focus Keyphrase: China Reduced Steel Production

China reduced steel production again in response to both policy and economic headwinds. According to analysts, the drop reflects not only softening demand but also Beijing’s strategic move to stabilize the market. In Tangshan — a major steel hub — temporary restrictions are in place to curb pollution, demonstrating the state’s commitment to controlling output.

Chelsea Ye, an analyst at McCloskey by Opis, noted that these curbs appear effective even without formal annual quotas. She emphasized that China may now maintain stable full-year output due to a natural decline in consumption, especially in construction and manufacturing sectors.

In 2024, China’s steel output dropped 1.7% to 1.005 billion tons — its lowest in five years. Many analysts now believe 2024 may mark the final year that China’s steel production exceeds 1 billion tons. Given structural shifts in the economy, including green energy expansion and housing reforms, the trend suggests a steady long-term contraction in steel demand.

SuperMetalPrice Commentary:

China’s ongoing production cuts highlight a broader realignment in the global steel market. As domestic demand wanes and regulatory pressure intensifies, China is stepping back from unchecked capacity growth. This could reshape global steel pricing and trade flows in the second half of 2025. Markets should closely monitor steel export volumes and policy signals from Beijing, especially around September’s military events. If China continues on this path, the world may finally see sustained moderation in steel output from its largest producer — a trend with long-term implications for pricing, trade, and decarbonization in the metals sector.