Steel Trade Market Trends in January 2026
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- Issue Time
- Feb 3,2026
Summary
Combined with the impact of the Spring Festival holiday, activity on both the supply and demand sides of the market is expected to decline temporarily. It is projected that the domestic steel market in February will likely experience a narrow-range fluctuation.
According to the China Metal Materials Circulation Association and Lange Steel Website, the joint release of the China Metal Materials Circulation Association & Lange Steel Website · Steel Circulation PMI Index for January 2026 was 47.1%, a decrease of 0.9 percentage points from the previous month. This marks a further decline within the contraction range, indicating that the domestic steel market has entered the traditional demand off-season. However, it is also in a period of "expectations" driven by macroeconomic policies. As steel mills enter a new production cycle, capacity utilization typically shows a gradual rebound in line with annual trends. Currently, the first-quarter ex-factory prices of major domestic steel enterprises have been steadily adjusted upward. Amid the ongoing interplay between "expectations and reality," traditional winter stocking operations will gradually come into focus. Nevertheless, due to the multifaceted and deep-seated transformation the steel industry has undergone in recent years, the marginal benefits of winter stocking have diminished. Participants across the steel industry chain exhibit limited enthusiasm for winter stocking. Combined with the impact of the Spring Festival holiday, activity on both the supply and demand sides of the market is expected to decline temporarily. It is projected that the domestic steel market in February will likely experience a narrow-range fluctuation.
(Source: China Metal Materials Circulation Association)
In January 2026, the domestic steel market as a whole showed a strong oscillation trend. Main influencing factors
1
Supply side restrictions: Due to environmental restrictions and steel mill maintenance, the release of steel production is limited, and the market supply and demand continue to be in a "weak balance" state, which provides certain support for prices.
2
Differentiation of demand structure: The demand for construction steel weakens seasonally due to the approaching winter climate and Spring Festival, but the demand for steel in the manufacturing industry remains resilient. Carbon steel pipes, as an important raw material in the industrial manufacturing field, have a high correlation between their demand and the manufacturing industry, and may therefore be supported by manufacturing demand.
3
Policy and Cost Impact: The new steel export license policy and the EU Carbon Border Adjustment Mechanism (CBAM), which came into effect on January 1st, have an impact on the export market. At the same time, cost support maintains resilience, and these factors work together to affect market price expectations.