China's Domestic Pig Iron Market Maintains Stability with a Watchful Outlook

1. Macroeconomic Overview

This week, the supply of the five major steel products reached 8.1518 million tons, marking a weekly increase of 183,600 tons, or 2.3% . Concurrently, the total inventory of these five major steel products fell to 12.3215 million tons, a decrease of 258,400 tons from the previous week, down 2.1% . The apparent weekly consumption was 8.4102 million tons, showing a slight increase of 0.9% compared to last week. Specifically, consumption of long products (used in construction) rose by 0.1%, while that of flat-rolled products increased by 1.3% . In international trade, a new regulation took effect on January 1, 2026, imposing additional import tariffs ranging from 5% to 50% on over 1,400 categories of goods—including automobiles, parts, home appliances, and steel—imported from Asian countries without a Free Trade Agreement (FTA) with Mexico .

2. Cost Analysis

The fourth round of coke price reductions has been implemented, while iron ore prices are experiencing narrow fluctuations . In the short term, cost support for pig iron remains generally moderate.

3. Supply and Demand Dynamics

On the supply side, the restart of some blast furnaces has led to a recovery in output. However, overall inventory levels remain low, leaving suppliers with minimal pressure to clear stock and fostering a reluctance to sell at lower prices . On the demand side, downstream foundry enterprises are maintaining cautious purchasing strategies, primarily buying based on immediate needs, which results in a generally subdued market atmosphere .

4. Overall Forecast

Considering the stable cost foundation, manageable supply pressure, and persistently weak demand, the pig iron market is expected to continue its stable trend in the coming day, with participants likely adopting a wait-and-see approach