[SMM Steel Market Morning Briefing] The fourth batch of the third round of central ecological and environmental protection inspections fully launched

★Macro★

01★★ 

Chinese Premier Li Qiang Attends Symposium for Chinese Enterprises in Indonesia

On the afternoon of May 25 local time, Chinese Premier Li Qiang attended a symposium for Chinese enterprises in Indonesia. Li Qiang pointed out that China will continue to strengthen economic and trade cooperation with more countries, create a favorable environment for the overseas operations and development of Chinese enterprises, provide more conditions and opportunities, and offer stronger policy support to enterprises.

★Industries and Downstream Sectors★

01

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The Fourth Batch of the Third Round of Central Ecological and Environmental Protection Inspections Fully Launched

Approved by the CPC Central Committee and the State Council, the fourth batch of the third round of central ecological and environmental protection inspections has been fully launched. Eight central ecological and environmental protection inspection teams will conduct inspections in five provinces (autonomous regions) including Shanxi, Inner Mongolia, Shandong, Shaanxi, and Ningxia, coordinating both Yellow River basin inspections and provincial inspections. Meanwhile, inspections will also be carried out on three central state-owned enterprises: China Huaneng Group, China Datang Corporation Limited, and SPIC. The inspection period will last approximately one month.

02

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[SMM Domestic Mine Operating Rate] Mines and Beneficiation Plants Produce as Planned, Iron Ore Concentrates Production Remains Relatively Stable

According to the latest data from SMM, the capacity utilisation rate of domestic mines reached 59.2% last week, a slight decrease of 0.1 percentage points from the previous week. The production of iron ore concentrates was 790,000 mt, basically flat WoW. Sales volume was 770,000 mt, a decrease of 7,000 mt WoW. The inventory of mine concentrates increased by 20,000 mt, with the total inventory now at 280,000 mt.

Currently, mines and beneficiation plants are operating as planned, with iron ore concentrates production remaining relatively stable. Mines in Liaoning are once again facing safety inspections, mainly targeting the discharge issues of tailings ponds. In the short term, the impact on local production is limited, but some small and medium-sized mines and beneficiation plants may face the risk of production suspension for rectification. In Inner Mongolia, due to the blast furnace maintenance at a large steel mill, the shipment of ore has slowed down, and inventory has accumulated. It is expected that the production of iron ore concentrates will remain stable this week. Attention should be paid to the progress of production resumptions at some large mines in Hebei and Shandong, which may bring a certain increase in local iron ore concentrates supply.

03

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China Meteorological Administration Initiates Level III Emergency Response for Heavy Rain

According to the China Meteorological Administration, it is expected that from May 27 to 29, heavy to torrential rain will occur in most areas of southern China, including the regions south of the Yangtze River, southern China, Guizhou, and Yunnan. Some areas in eastern and southern Guizhou, Hunan, southern Jiangxi, Fujian, northern Guangxi, and northern Guangdong will experience extremely heavy rainfall, accompanied by short-term heavy precipitation, thunderstorms, or gales. After comprehensive analysis and emergency consultations, the China Meteorological Administration activated a Level III emergency response for heavy rainfall.

04

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Second round of coke price cuts implemented

On the 26th, some steel mills in Xingtai, Tianjin, Shijiazhuang, and Tangshan regions reduced the prices of wet-quenched coke by 50 yuan/mt and dry-quenched coke by 55 yuan/mt, with implementation effective from 00:00 on May 28, 2025.

05

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Total steel port departures decreased by 22% WoW last week

[Total steel port departures decreased by 22% WoW last week]From February 22 to February 28, 2025, the total volume of steel shipped from ports nationwide, as tracked by SMM, was 267.51 mt, a decrease of 739,400 mt WoW, representing a 22% decline. Ports such as Caofeidian, Jingtang Port, Tianjin Xingang, Changshu Port, and Fangchenggang all experienced decreases in port departures.

[Last week, coking coal arrivals at ports totaled 2.5264 million mt, up 900,600 mt WoW]According to SMM tracking, the total volume of coal arriving at ports this week was 7.7286 million mt, an increase of 1.1835 million mt WoW. By type, coking coal arrivals were 2.5264 million mt, up 900,600 mt WoW; coke arrivals were 0 mt, down 4,400 mt WoW.

[Last week, SMM's global iron ore shipments totaled 35.4 million mt, up 1.35 million mt WoW]Last week, SMM's global iron ore shipments totaled 35.4 million mt, an increase of 1.35 million mt WoW, with the growth rate slightly narrowing. Brazil had the largest increase in shipments. SMM's total iron ore arrivals in China were 25.48 million mt, a decrease of 800,000 mt WoW, with lump ore and pellet declines exceeding those of coarse powder and concentrate.

★Other Hot Topics★

⭕[Guangxi adjusts deed tax rates for individuals purchasing first and second homes]The Department of Housing and Urban-Rural Development of the Guangxi Zhuang Autonomous Region and other departments jointly issued the "Notice on Further Clarifying Deed Tax Policies to Promote the Steady and Healthy Development of the Real Estate Market in Our Region." The notice adjusts the deed tax rates for individuals purchasing first and second homes in Guangxi. For individuals purchasing their only family home in Guangxi (family members include the homebuyer, spouse, and minor children, the same hereinafter), with an area of 140 m² or less, the deed tax will be levied at a reduced rate of 1%; for homes over 140 m², the rate will be 1.5%. For individuals purchasing a second family home in Guangxi, with an area of 140 m² or less, the deed tax will be levied at a reduced rate of 1%; for homes over 140 m², the rate will be 2%. A second family home refers to a second home purchased by a family that already owns one home in Guangxi.

⭕[Henan: Aims to complete around 500,000 vehicle scrappages and replacements, and over 8 million home appliance trade-ins by 2025]The General Office of the Henan Provincial People's Government recently issued the "Implementation Plan for Special Actions to Boost Consumption in Henan Province."It was proposed to intensify efforts to promote trade-in policies. Support will be provided for vehicle scrappage and replacement. In 2025, a maximum subsidy of 20,000 yuan will be offered for scrapping eligible old passenger vehicles and purchasing new energy passenger vehicles (NEVs), and a maximum subsidy of 15,000 yuan for purchasing gasoline-powered passenger vehicles. A maximum subsidy of 15,000 yuan will be offered for transferring old vehicles and purchasing NEVs, and a maximum subsidy of 13,000 yuan for purchasing gasoline-powered passenger vehicles. In 2025, efforts will be made to achieve the scrappage and replacement of approximately 500,000 vehicles and the trade-in of over 8 million home appliances.

⭕[Volvo Cars to Lay Off Nearly 3,000 Employees Globally] Volvo Cars announced on the 26th that it would lay off employees globally as part of the company's recently launched cost and cash action plan. This action plan, costing 18 billion Swedish kronor (approximately $1.9 billion), aims to streamline the organization and structurally reduce the cost base, equivalent to cutting approximately 3,000 positions worldwide, including consultants, across Volvo Cars' operations. The layoffs will primarily affect office positions in Sweden, accounting for about 15% of the company's global office workforce. Volvo Cars expects to incur one-time restructuring costs of up to 1.5 billion Swedish kronor.

⭕[CPCA Secretary General Cui Dongshu: China Accounted for 33% of Global Auto Sales from January to April 2025] CPCA Secretary General Cui Dongshu stated in an article that global auto sales reached 7.56 million units in April 2025, up 5% YoY. Despite the strength of the US and Chinese auto markets in April, sales in April 2025 were still 1% lower than the peak in April 2018, placing them in the mid-to-high range historically. From January to April 2025, sales reached 30.26 million units, up 5% YoY. China accounted for 33% of global auto sales from January to April 2025, a normal reflection of the Chinese New Year factor, which typically leads to lower sales at the beginning of the year for Chinese automakers. As the effects of policy stimuli become evident, the Chinese auto market began to strengthen in March and April.