[SMM Steel Market Morning News] A new round of heavy rainfall will hit south China starting from the 27th

★Macro★

01★★ 

Yields on major interbank interest rate bonds rise with a wider margin; 10-year government bond yield returns to 1.7%

The yields on major interbank interest rate bonds rose with a wider margin. The yield on the active 10-year government bond 250004 rose by 1.4 basis points (bps) to 1.7%; the yield on the active 30-year government bond 2500002 rose by 2.15 bps to 1.9065%; and the yield on the active 10-year China Development Bank bond 250205 rose by 0.9 bps to 1.749%.

02★★★

US President Trump proposes a 50% tariff on EU imports starting June 1

On May 23, US President Trump proposed a 50% tariff on EU imports starting June 1.

★Industries and Downstream Sectors★

01 ★★★  

CPCA Secretary General Cui Dongshu: China's auto exports reach 2.16 million units from January to April, with a YoY growth rate of 15%

CPCA Secretary General Cui Dongshu stated in an article that from January to April 2025, China's auto exports reached 2.16 million units, up 15% YoY compared to the same period in 2024. In April, China's auto exports reached 620,000 units, up 12% YoY and 36% MoM, showing strong growth trends both YoY and MoM. The main drivers this year remain the enhanced competitiveness of Chinese products and the slight growth in the markets of southern countries globally. However, the cycle of international brands in the Russian market being fully replaced by Chinese vehicles amid the Russia-Ukraine crisis may come to an end, resulting in a significant decline.

02 ★★ 

Shanghai Shipping Exchange: The export container shipping market continues to improve

On May 24, the weekly report on China's export container shipping market released by the Shanghai Shipping Exchange indicated that the market continued to improve this week, with freight rates on most ocean routes maintaining an upward trend, driving the composite index higher. According to the latest data released by the National Bureau of Statistics (NBS), the value-added industrial output above designated size increased by 6.1% YoY in April, demonstrating the strong resilience of China's economy and its continued steady growth.

03 ★★ 

Water conservancy construction investment exceeds 290 billion yuan in the first four months

Since the beginning of this year, the Ministry of Water Resources has accelerated the implementation of major water conservancy projects under the "implementation of major national strategies and the development of security capabilities in key areas." From January to April, the construction of water conservancy infrastructure across the country progressed smoothly, with 294.36 billion yuan invested in water conservancy construction. A total of 26,800 water conservancy projects were implemented nationwide, including 11,149 newly started projects.

Since the beginning of this year, new progress has been made in the construction of major ongoing water conservancy projects. The construction of projects such as the Guxian Water Control Project on the Yellow River and Phase II of the Huaihe River Outlet to the Sea has accelerated. Phase II of the project to divert water from the Yangtze River to the Huaihe River is being accelerated along the entire line. Upon completion, it will replace water sources in 28 counties (cities, districts) in northern Anhui.

04★★★

[Heavy to torrential rain expected in some areas; a new round of intense precipitation to hit south China starting from the 27th]

The cold air process that has been affecting most parts of China since May 21 is currently coming to an end. Today, rainfall is still expected in Yunnan, Guangxi, Sichuan, and other regions. The Central Meteorological Observatory forecasts that starting from the 27th, a new round of intense precipitation weather process will occur in south China. There is a high risk of meteorological disasters such as mountain floods and geological disasters in regions including Guangdong and Yunnan.

★Other Hot Topics★

⭕[Peak shipping season for US routes may arrive earlier; booking freight space is like "snatching tickets"]Following adjustments to the Sino-US tariff policies, US buyers have stepped up their "stockpiling" efforts, leading to an increase in the popularity of US-bound maritime shipping. The Yantian International Container Terminals in Shenzhen handles over a quarter of China's export volume to the US. Chen Zehao, the on-duty manager of the Operations Service and Development Department at Yantian International Container Terminals, stated that traditionally, the peak season was from July to September, but this year it has been advanced to June and July. Reporters have learned that multiple shipping companies have announced rate increase plans for routes from Asia to the US, with the highest increase being $3,000 for a 40-foot container. Industry insiders indicate that this market situation is the result of a combination of changes in shipping capacity and demand.

⭕[Trump changes stance on Nippon Steel's deal with US Steel]US President Trump stated on the 23rd that US Steel and Nippon Steel would reach a "planned partnership," with Nippon Steel investing in US Steel, which would continue to "remain in the US." On the same day, Trump posted on the social media platform "Truth Social" that US Steel's headquarters would continue to be located in Pittsburgh, Pennsylvania. "This will be a planned partnership between US Steel and Nippon Steel, which will create at least 70,000 jobs and add $14 billion to the US economy. Most of the investment will be completed within the next 14 months."

⭕[Trump: 25% tariff on mobile phone manufacturers not producing in the US but selling there]Trump has stated that a 25% tariff will be imposed on mobile phone manufacturers not producing in the US but selling there. Trump warned that if Samsung products are not made in the US, a 25% tariff will be imposed. If Apple and Samsung establish factories in the US, they will be exempt from tariffs. If they sell in the US, they need to manufacture there. Trump stated that tariffs on Apple and Samsung will be imposed before the end of June.

⭕[Zhuhai issues guidelines for applying for special subsidies for "trade-in" housing, with a maximum subsidy of 30,000 yuan]The Zhuhai Municipal Housing and Urban-Rural Development Bureau has issued the "Guidelines for Applying for Special Subsidies for 'Trade-in' Housing in Zhuhai," which clearly state: From May 6, 2025, to May 5, 2026, individuals who purchase newly built commercial housing within the Zhuhai city area (excluding the Hengqin Guangdong-Macao Deep Cooperation Zone) and sell their original family housing within the same area during this period will be eligible for a special subsidy for "trade-in" housing at 1% of the online contract price of the newly purchased home, with a maximum subsidy not exceeding 30,000 yuan. There is no specific order for buying a new home and selling an old one. Special subsidies are claimed based on the "sell one, buy one" principle. The new homes mentioned in this guide do not include policy-based housing such as affordable housing, talent housing, and resettlement housing, nor do they include foreclosed properties.

⭕[Coal accounts for less than 1% of Beijing's energy consumption]Beijing has achieved a historic optimization of its energy structure. The city's coal consumption has decreased from 21.8 million mt in 2012 to less than 600,000 mt in 2024, accounting for less than 1% of energy consumption. Next, Beijing will focus on strengthening the innovative development of industries such as energy conservation, hydrogen energy, and energy storage systems (ESS). Following the basic direction of "energy conservation, increased greening, reduced gas use, decreased oil consumption, and cleaner coal," the city will fully promote the green and low-carbon transformation of its energy structure and comprehensively enhance the development quality of its energy infrastructure.

⭕[US rebar imports increased by 85.9% in March]According to the final data released by the US Department of Commerce, the US imported 85,753 mt of rebar products in March 2025, representing an 85.9% increase MoM but an 11.5% decrease YoY compared to March 2024. The import value in March was $52.3 million, up from $30.8 million the previous month and down from $59.7 million in the same period last year.

In March this year, the main suppliers of rebar to the US were Egypt (27,750 mt), Vietnam (16,770 mt), Bulgaria (16,118 mt), Mexico (7,672 mt), and the Dominican Republic (7,501 mt).

⭕[German steel production decreased by 10.1% YoY in April]The German Industry Association reported that Germany's crude steel production in April 2025 was 2.95 million mt, a 10.1% decrease YoY compared to the same period in 2024, and down from 3.11 million mt the previous month. In the four months since the beginning of this year, the country's crude steel production was 11.45 million mt, a 11.9% decrease YoY. Meanwhile, Germany's pig iron production in April was 1.86 million mt, an 11.2% decrease YoY, and pig iron production in the four months was 7.18 million mt, a 14.6% decrease YoY. Meanwhile, in April 2025, the country's hot-rolled steel production decreased by 8.6% YoY to 2.49 million mt, and by 10.4% YoY to 10.13 million mt from January to April.

⭕[Fuxin Iron and Steel to build two new 100T electric arc furnaces]The capacity replacement, upgrading, and transformation project of Longnan Fuxin Iron and Steel Co., Ltd. is located in the Huilong Industrial Park, Longnan Economic and Technological Development Zone, Ganzhou City, Jiangxi Province. The project has a total investment of 3.097 billion yuan and covers an area of 957 mu. Focusing on energy conservation, carbon reduction, ultra-low emissions, safe production, digital transformation, and intelligent upgrading, the project will build two new 100T electric arc furnaces, refining, continuous casting, and steel rolling production lines, supported by facilities for dust collection ash recycling, photovoltaic (PV) power generation, and ultra-low emissions. Phase II plans for a 1,580 thin-strip casting and rolling production line.