The World Steel Association (WSA) estimates China's steel demand to be flattish in 2024 and to slip 1% in 2025 in its April Short Range Outlook, mainly weighed down by lower real estate investment.

For 2024, WSA expects growth in infrastructure and manufacturing to compensate for the demand loss from property. But they admit they underestimated China's steel demand weakness in Q4 2023, so that they needed to revise down their demand forecast for 2023 compared to last October by around 5%.

The apparent steel use estimate for China in 2023 turns out to be a 3.3% drop on-year, much more in line with the Kallanish calculation of -3.5% than the original WSA forecast of 2% growth.

China has policies to boost demand by building affordable housing, renovating urban villages and constructing emergency public facilities, the so called “The Three Major Projects." But local government financial burdens may slow down projects.

The central government ordered 12 indebted local government to delay or stop some state-owned infrastructure projects this January.

For manufacturing, China saw robust car production this March and surging shipbuilding for the first two months this year. But more trade defence measures are being signalled globally, including from the EU and the United States.

The European Commission started customs registration of electric vehicles from China last month as a step in their anti-subsidy investigation since last October.

Five national labour unions meanwhile filed a petition for the US Trade Representative to investigate China's shipbuilding sector last month.

In addition, steelmakers in Vietnam have filed anti-dumping petitions last month against China's hot rolled coils.

The China Iron & Steel Association (CISA) and the China Metallurgical Planning and Research Institute (MPI) estimates that 2024 demand will drop 1% and 1.7% on-year respectively