[SMM Steel Market Morning Brief] Caixin China General Manufacturing PMI Dropped to 48.3 in May, Contracting for the First Time Since October 2024

★Macro★

01 ★★★ [Caixin China Manufacturing PMI Drops to 48.3 in May, First Contraction Since October 2024]

China's Caixin manufacturing PMI came in at 48.3 in May, falling below the boom-or-bust line for the first time since October 2024, compared with expectations of 50.7 and the previous reading of 50.4.

02 ★★★ [Heavy Rainfall Expected in Yunnan, Coastal South China, and Northeast China on June 3-4]

From June 3 to 4, rainfall in China will mainly occur in Yunnan, coastal areas of South China, and northeast China, with some regions potentially experiencing severe convective weather. As the high-pressure ridge moves eastward, temperatures in most northern regions will gradually rise.

★Industry & Downstream★

01 ★★★ [Guangzhou Port: Container Throughput in May Expected to Rise 4.3% YoY]

Guangzhou Port (601228.SH) announced that in May 2025, it is expected to handle 2.309 million TEUs of container throughput, up 4.3% YoY, while cargo throughput is projected at 5.0175 million mt, down 0.3% YoY. From January to May, the company estimates container throughput at 10.995 million TEUs (up 8.5% YoY) and cargo throughput at 236.489 million mt (up 3.0% YoY).

02 ★★★ [CIA: New Home Sales in Core Cities May Gain Some Support in June]

China Index Academy noted that in May, land markets in core cities maintained some heat but showed marginal weakening, with YoY growth in residential land sales revenue narrowing among 300 cities. Premium plots in Hangzhou, Beijing, Shanghai, and Chengdu continued to fetch high premiums. The RRR and interest rate cuts implemented in May boosted market confidence. During the Dragon Boat Festival holiday, multiple regions extended sales promotions, but overall market performance remained mediocre, with weak employment and income expectations still being the primary constraints on housing demand. June's property policies are expected to maintain a loose stance, focusing on progress in special bond issuance and urban village redevelopment. As the mid-year sales period approaches, developers may accelerate project launches and promotions, coupled with the introduction of "quality housing" products, potentially supporting new home sales in core cities, though divergence between cities and projects will persist.

★Other Hot Topics★

⭕[China Coal Transport and Distribution Association: Coal Consumption Remains Weak Since April] The China Coal Transport and Distribution Association released the operational status of China's coal market since April 2025: Since April, China's coal capacity has continued to expand, production has maintained growth, imports have declined further, and supply remains ample. Overall coal consumption remains weak, with coal inventories across society at historically high levels. The supply and demand of coal are relatively loose, and coal prices continue to decline, leading to a significant drop in the economic benefits of the industry.

⭕[Shenzhen plans to supply 1,060 hectares of construction land in 2025] Recently, with the approval of the Shenzhen Municipal Government, the Shenzhen Municipal Planning and Natural Resources Bureau issued and implemented the "2025 Construction Land Supply Plan of Shenzhen". The city (including Qianhai and Shenshan) plans to supply 1,060 hectares of construction land in 2025. This year, the supply of industrial land will be significantly increased to lay the foundation for the high-quality economic development of Shenzhen. An adequate supply of land for residential and public facilities, as well as other livelihood-related purposes, will be ensured. The supply schedule will be arranged flexibly to achieve precise supply of various types of land.

⭕[In May, the transaction area of newly-built commercial residential properties in Shanghai increased by 23.7% YoY] Data shows that in May, the transaction area of newly-built commercial residential properties in Shanghai was 618,000 m², up 16.5% MoM and 23.7% YoY.

⭕The Ministry of Commerce and four other departments organized the 2025 New Energy Vehicle (NEV) Rural Promotion Campaign. A number of special events will be held in typical county-level cities with low NEV promotion rates and significant market potential. These events will serve as hubs to radiate to surrounding towns, with a series of characteristic activities tailored to regional characteristics.

⭕The All-China Federation of Automobile Dealers Commerce Chamber proposed: The entire industry should prioritize the overall goal of achieving high-quality development in China's automotive industry, strictly adhere to the principle of fair competition, and resolutely resist "cut-throat competition" primarily in the form of "price wars".

⭕China Commercial Vehicle Network: In May, around 83,000 heavy-duty trucks were sold in China, down slightly by 5% MoM from April this year, but up about 6% from 78,200 units in the same period last year. This marks the second consecutive month of growth in the heavy-duty truck market since April this year.

⭕Clarksons: In April 2025, the vast majority of alternative fuel newbuilding orders were secured by Chinese shipyards, totaling 32 vessels with 1.998 million CGT, accounting for 68.3% of the alternative fuel newbuilding orders in April 2025 by CGT, ranking first globally in terms of orders taken.