The rise in Chinese steel flows indicates how weak domestic steel demand was in 2025. Typically, steel exports make up between 8-10% of total Chinese steel production; this almost jumped to over 12% in 2025. There is an interesting relationship between Chinese crude steel production and Chinese steel exports. When crude steel production is high, exports are typically lower, and when production is weak, exports tend to surge. Exports, therefore, function as the adjustment mechanism when China’s domestic steel market is weak.

We are yet to see China’s crude steel production figures for January 2026, but TSOP has recorded China’s steel flows to be up 12% y/y, indicating that crude steel production is likely to be down. CNY also plays a big part in weak production during the first two months of any year.

Global steel demand is expected to grow modestly in 2026, with stronger performance concentrated in certain regions. This could put pressure on export opportunities due to a smaller pool of destinations. That being said, India is expected to increase consumption by over 9% in 2026. China typically accounts for only 3% of its steel exports to India, but with such a rise in demand forecast, 2026 could see a higher proportion of Chinese steel finding its way to India.