China Domestic Pig Iron Market Daily Report

Market Overview

Date: Tuesday, January 20, 2026

The domestic pig iron market exhibited stable operations today. The market is influenced by a confluence of factors, including macroeconomic policy developments, futures market trends, cost fluctuations, and the current supply-demand landscape.

Macroeconomic Policies

Key policy developments were announced today, as the Ministry of Finance released a series of five documents focusing on consumer credit and private investment. The main measures include:

• Implementation of loan discount policies for micro, small, and medium-sized enterprises (MSMEs).

• Optimization of loan discount policies for business entities in the service sector.

• Rollout of a special guarantee program to support private investment.

• Optimization of fiscal discount policies for equipment renewal loans.

• Optimization of fiscal discount policies for individual consumer loans.

Concurrently, the National Development and Reform Commission (NDRC) commented on the current economic climate, noting a disparity between robust supply and weaker demand. The policy focus will be on strengthening the domestic economic cycle and comprehensively boosting domestic demand. Specifically, efforts will align with the nation's consumption upgrade trend and the needs of the new technological revolution and industrial transformation. The NDRC will formulate an implementation plan for the 2026-2030 strategy to expand domestic demand, with the goal of stimulating new demand through innovation in supply, supported by robust policy measures and resource allocation.

Futures Market Performance

As of the market close, the main ferrous commodities futures contracts registered widespread declines:

• Iron Ore: Down 8, closing at 789.5.

• Coke: Down 61.5, closing at 1673.5.

• Coking Coal: Down 53, closing at 1124.

• Rebar: Down 37, closing at 3111.

• Hot-Rolled Coil (HRC): Down 32, closing at 3276.

Cost Analysis

1. Coke Market

Most coking plants are operating near breakeven levels, with little expected change in short-term supply. Steel mills continue their prudent, demand-based procurement, leading to an ongoing standoff between coke producers and steelmakers.

2. Iron Ore Market

Port inventories for iron ore have continued to reach record highs, contributing to price volatility and adjustments. Consequently, cost support for pig iron from the raw materials side has somewhat weakened.

Supply and Demand Dynamics

1. Supply Side

Inventory levels at most pig iron producers remain low, with some plants even reporting negative inventories. This supply tightness forms a solid price floor, reinforcing producers' firm pricing stance.

2. Demand Side

The continued weakness in the ferrous futures complex has further dampened market sentiment, fostering a wait-and-see attitude. Downstream foundries and steelmakers display tepid procurement interest, largely sticking to hand-to-mouth purchasing based on immediate production needs. Consequently, overall market transactions lack momentum, and prices lack a fundamental catalyst for a sustained upward move.

Market Outlook

Date: Wednesday, January 21, 2026

Based on a comprehensive analysis of the above factors, the pig iron market is expected to maintain overall stability with a potential slight upward bias tomorrow. Market participants are likely to remain cautious, adopting a wait-and-see approach.