[SMM Analysis] Weekly Review of Global Steel Market, Issue 11

[SMM Analysis] Weekly Review of Global Steel Market, Issue 11

Last week, steel prices strengthened amid speculation over events such as production restrictions and coking coal imports. Meanwhile, the much-discussed export license issue in the market has been partially absorbed, with the trading atmosphere recovering mid-week. According to the SMM survey, as of now, the licenses have increased the complexity of export procedures but have not yet imposed substantive restrictions on customers' exports. Additionally, overall market expectations for definitive ticket inspections remain low. Therefore, it is comprehensively estimated that the subsequent impact on purchase orders will be relatively small. However, the final outcome still needs to be assessed after the situation becomes clear on January 1. As of last Friday, China's export offers stood at $460-465/mt for HRC and $437-445/mt for billets.

Overseas market perspective: Southeast Asian market: This week, steel market quotes in Southeast Asia have slightly declined. Resources from China, Indonesia, and India have created price competition in the Southeast Asian market, particularly for rebar and HRC, with buyers showing a strong desire to push for lower prices and the transaction center moving downward. Meanwhile, affected by the off-season and the slow progress of terminal projects, the overall demand for construction steel has been sluggish. Purchase willingness in Singapore, Vietnam, and other places remains insufficient, with the market primarily focused on digesting previous inventory. Regarding policy impacts, China's export licensing system, set to take effect in January 2026, has fostered a strong wait-and-see sentiment in the market. If implemented strictly, it may constrain the pace of exports and affect the pricing mechanism in Southeast Asia. Overall, market activity in Southeast Asia has slowed down during the Christmas to New Year period, with sluggish trading and narrowed price fluctuations.

Middle Eastern market: This week, the Middle Eastern market showed divergent performance. In the UAE, recent rainfall has not substantially impacted construction and logistics, leading the market to enter a policy observation period with stable demand and limited price fluctuations. In contrast, Saudi Arabia has seen robust demand for construction steel due to ongoing government projects, with steel mills having full order books, supporting price rises.

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