China’s stainless output accelerated ahead of tariffs

China’s stainless steel output grew to a record 39.44 million tonnes in 2024, contributing to the increased global production applying downward pressure to prices.

The world’s largest stainless steelmaking country grew melt shop production by 7.5% as global production rose by 7% in 2024, data published by worldstainless shows. Increased volumes were recorded in all the regions assessed, resulting in a total output of 62.62m tonnes.   

Europe registered the year’s lowest level of growth, up by just 1.5% to 6.08m tonnes. Output increased by 6.9% in the United States, 6.4% in Asia (excluding China and South Korea), and 9.2% in worldstainless’ ‘others’ category, which is comprised of Brazil, Indonesia, Russia, South Africa and South Korea.  

• This article first appeared in the April edition of MEPS International's Stainless Steel Review. The publication features market insight, stainless steel prices, indices and forecasts from key markets in Europe, Asia and North America. Visit mepsinternational.com or contact MEPS for details of how to subscribe.

The widespread production growth meant that China’s share of the global market was 58.8% last year, down from 59.6% a year earlier. However, a 19.3% year-on-year surge in production during quarter four, to 10.74m tonnes, suggested that the country’s output may continue to grow. Subsequently, domestic crude stainless steel production decreased by just 2.8% quarter-on-quarter in the first three months of this year – representing a year-on-year rise of 10.6%.  

Increased global stainless steel production will add to the downward pressure already being applied to prices by low demand and, more recently, a decline in the cost of raw materials. This is particularly the case in markets outside Asia – including the US and Europe – where consumption has stagnated.  

Worldstainless had previously forecast that a 19.1% year-on-year consumption decline in its Europe/Africa category during 2023 would be followed by a further decline of 4.7% in 2024. It also projected a 0.4% decline in consumption in its Americas region in 2024, following a 9.4% dip in 2023. Nonetheless, it forecast a 5.3% increase in China and a 6.5% increase in the rest of Asia, contributing to an overall increase of around 4%.   

Trade defence measures tighten  

The introduction of stringent new import tariffs in the United States will stall demand from steel-consuming sectors in China during 2025. As this report was published, tariffs of up to 240% were still applicable to Chinese-origin imports of various goods, including electric vehicles and solar panels. A 145% rate was applied to other products.  

In early April, MEPS respondents in the EU reported that the European Commission’s import safeguard measures will also present challenges for Asian stainless steel producers. They said that many importers are exploring potential new sources in Malaysia, Vietnam and South Korea after Taiwan’s quarter two cold rolled coil quota was quickly filled. The European Commission’s exploration of a possible “melted and poured” rule, to prevent circumvention of its trade defence measures, could compromise some of these sources, however. Among a limited number of stainless steel producing nations, outside Europe, where producers “melt and pour” their own material are China, Indonesia, India, Japan, South Africa, South Korea, Taiwan and the US.  

In 2024, China’s stainless steel exports increased by 2.9% year-on-year to 5.04 million tonnes. In quarter one of this year, exports rose significantly ahead of new US tariffs. Data published by the Stainless Steel Council of the China Iron and Steel Association showed that volumes were up by 15.5% to 1.23m tonnes in the three-month period. In March, volumes declined by 71.0% month-on-month, to 470,600 tonnes, but remained 21.8% up year-on-year.  

Tariffs and tightening trade restrictions in the US, Europe and Asia will aim to limit China’s future export opportunities. If they succeed, the downward price pressure resulting from rising production will be felt most in China’s domestic market.