China’s net exports of semi-finished and finished steel in 2020 dropped 69% on the year to 15.24 million mt, S&P Global Platts’ calculations showed based on China customs data.
However, due to recovering demand for China’s exports and a likely slowdown in domestic home starts in 2021, the net steel exports are likely to rebound in 2021, after trending downward for five years in a row starting from 2015, according to market sources.
The country’s semi-finished steel imports, comprising mainly billet and slab, increased to 18.22 million mt in 2020, up six-fold from 2019, according to the data. When added to the finished steel imports, it took China’s total steel imports in 2020 to 38.45 million mt, more than twice that from 2019.
China exported a gross 53.69 million mt of semi-finished and finished steel in 2020, down 17% year on year.
The strong semi-finished steel imports in 2020 were mainly due to a surge in imports from June to November, when domestic steel demand largely recovered, but other markets were still in lockdowns or just beginning to recover from the impact of the coronavirus pandemic.
But overseas demand recovery has accelerated since late 2020, which reduced the need to sell into the Chinese market, while boosting China’s steel exports.
China’s semi-finished steel imports in December dropped 48% on the month to 0.86 million mt, already to the same level from a year earlier. The combined imports of semi-finished and finished steel in December dropped 36% on the month and 5% on the year to 2.23 million mt.
In the meantime, exports of semi-finished and finished steel in December increased 10% on the month and 4% on the year to 4.85 million mt.
Several market sources expected China’s semi-finished and finished steel imports to continue declining in the first quarter of 2021, while exports to climb, as overseas demand has improved substantially and the domestic market will be in a traditionally weak season amid the Lunar New Year holidays.
— Jing Zhang