China steel industry tightens export control, strengthens self-discipline to stabilize market

With "volume reduction" now a structural reality, the Chinese steel sector is shifting its focus from expansion to profitability and quality growth.

"China's steel sector remains well positioned despite near-term pressures from oversupply and weak demand," said Song Zeqi, general manager of Wuhan Iron & Steel Company, a subsidiary of listed Baoshan Iron & Steel Co (Baosteel).

He noted that China will continue to be the world's largest steel producer and consumer in the coming years, with manufacturing demand expected to account for more than half of total steel use.

Rapid growth in new energy vehicles, wind power and solar installations is also creating fresh demand for higher-grade steel products, providing medium- to long-term demand support for the market, Song added.

CISA vice chairman Luo Tiejun said industry-led self-discipline measures introduced since early this year, including regional and product-based coordination, have lifted sector profitability to its highest level in four years. However, he warned that supply and demand imbalances remain.

Strong supply and subdued demand have pushed some Chinese steel exporters to raise volumes at lower prices, triggering a surge in anti-dumping and safeguard cases overseas. "Prolonged low-priced steel exports are unsustainable and undermine both export channels and domestic market stability as such trade measures take effect," Luo said.

Addressing trade frictions, He Yujie, director at the Trade Remedy Bureau of the Ministry of Commerce (MoC), said steel trade disputes have become increasingly complex and politicized in recent years.

He urged Chinese steel companies to adopt country-specific response strategies, strengthen coordination with industry associations, and work closely with government authorities. Diversifying export destinations and moving toward higher-end, differentiated steel products are critical to reducing long-term trade risks.

China has also tightened oversight of steel exports. Shuai Sida from MoC's Department of Foreign Trade said the newly introduced export licensing regime (as Mysteel Global reported) now covers most steel products, semi-finished and stainless steels, as well as steelmaking raw materials including pig iron and scrap.

Under the new policy, effective January 1 2026, Chinese steel exporters must apply for licenses and submit contracts along with producer-issued quality inspection certificates.

"The policy is designed to improve steel export monitoring, reinforce compliance, and help the industry form more rational market expectations amid economic cycles and changing global trade conditions," Shuai said.

Qian Yuqiao from MoC's Quota and License Affairs Bureau outlined the application process. Steel export licenses follow "one license, one code" and "the exporter applies" principles, are valid for six months, cannot cross calendar years, and are issued each year in mid-December for the following year.

For steel exports under processing trade (where imported materials are processed and re-exported) and compensation trade (where exports offset imports), multiple shipments are allowed under one license (up to 12 times within its six-month validity), while other trade modes follow a one-shipment-one-license rule, underscoring authorities' intent to ensure orderly and compliant steel exports, Qian explained.

Edited by Vivian Yang, yangzhenqi@mysteel.com