China Steel Monthly Review: Divergent Trends in August – Rebar & HRC Decline, CR/MP Rise

Monthly Overview

In August 2026, China's steel market exhibited a clear divergence. Downstream demand from construction weakened, weighing on rebar and hot-rolled coil (HRC) prices, which fell -1.7% and -0.5% respectively versus the prior period. Conversely, stronger manufacturing demand and controlled supply supported冷轧 and medium plate (MP), posting gains of +0.1% and +1.3%. The DSP Composite Index stood at 961.05 as of mid-month, reflecting a consolidated but mixed market tone.

### Monthly Averages (Avg. vs. Prior Period) • 螺纹钢 (Rebar): ¥3,547/ton ▼ -62元 (-1.7%) • 热轧板卷 (HRC): ¥3,454/ton ▼ -16元 (-0.5%) • 冷轧板卷 (CR): ¥4,013/ton ▲ +4元 (+0.1%) • 中厚板 (MP): ¥3,801/ton ▲ +50元 (+1.3%) *Source: DSP SteelPrice Table*

DSP Composite Index

The DSP Composite Index registered at 961.05 on August 14, up +0.22% from the previous day. This index aggregates Shanghai spot prices and serves as a benchmark for market direction. The mid-month stability indicates that while individual product segments faced pressure, the overall market did not trend sharply downward, underpinned by targeted policy support and structural shifts in demand.

Product Analysis

### Rebar The average price fell to ¥3,547/ton, a decline of -1.7%. Prices fluctuated significantly throughout the month, surging to ¥3,790 on Aug 30 before settling at ¥3,550. This volatility reflects intermittent buying from consolidators against a backdrop of sluggish construction activity. As noted by Mysteel, the automotive sector saw a 22% year-on-year drop in retail sales, and home appliance September production forecasts were down, signaling weak downstream manufacturing pull (来源：mysteel, 2026-08-30). However, robust transportation infrastructure investment—1-7月公路水运累计完成固定资产投资18152亿元—provides a foundational floor for rebar demand (来源：mysteel, 2026-08-29).

### Hot Rolled Coil (HRC) HRC averaged ¥3,454/ton, down -0.5%. The price remained range-bound between ¥3,450-¥3,540 for most of the month, with a notable rebound on the final trading day to ¥3,620 (+0.8%). The weak performance is linked to softer auto and appliance sector demand, while the month-end recovery may be attributed to cost support from rising iron ore and coke prices (来源：mysteel, 2026-08-31). Import costs remain a key variable; Qindao port iron ore prices rose by ¥2/t on Aug 31, tightening input cost bases (来源：mysteel, 2026-08-31).

### Cold Rolled Coil (CR) CR posted a marginal gain to an average of ¥4,013/ton (+0.1%). Prices showed high volatility, spiking to ¥4,400 on Aug 28-30 before correcting to ¥3,990. This pattern suggests strong but elastic demand from the automotive and home appliance OEM sectors, coupled with producer adjustments. A mill price increase of ¥40/t by Shandong Xinghan galvanizing plant and a ¥25/t cumulative hike by Donghai cold-rolled base material indicate cost push from upstream processing (来源：lange, 2026-08-31). This underscores the value in securing CR contracts now before further margin compression.

### Medium Plate (MP) MP was the strongest performer, averaging ¥3,801/ton, up +1.3%. The price ranged from ¥3,640 to ¥4,000, closing at ¥4,070 on the final day. The upside is driven by order stability in shipbuilding and machinery sectors. Notably, Chinese shipyards secured nearly 80% of global new orders this year, providing sustained demand for medium plate (来源：mysteel, 2026-08-30). Supply-side discipline is also evident: major mill maintenance schedules, such as those from Wukun, Quanzhou MinGuang, and Xinjiang Kunlun, will reduce rebar and wire rod output by tens of thousands of tons in September, supporting price firmness across long products (来源：mysteel, 2026-08-30).

Macro Context

• Infrastructure & Policy Support: The NDRC's push for "Six Networks" and "Two Major Projects" continues to underpin steel demand in transport and energy. 1-7月交通固投达18152亿元 provides a solid demand base (来源：mysteel, 2026-08-29). • Manufacturing Demand Mixed: While shipbuilding and machinery orders remain strong, consumer-facing sectors like autos and home appliances are weakening. The 22% YoY drop in car retail and lower September appliance production forecasts highlight this dual trend (来源：mysteel, 2026-08-30). • Supply Side Adjustments: Several major mills are undertaking maintenance in September, including Wukun (-20kt), Quanzhou Minguang (-65kt), and Xinjiang Kunlun (-2.5kt/day rebar). These outages will tighten regional supply and support prices (来源：mysteel, 2026-08-30). • Cost Support: Iron ore and coke markets are trending higher. Qindao port iron ore prices rose by ¥2/t on Aug 31, and coking coal remains resilient, adding cost support to steelmaking (来源：mysteel, 2026-08-31).

Next-Month Outlook

September is expected to see moderate price support, driven by maintenance-induced supply cuts and ongoing infrastructure spending. However, weakness in consumer goods manufacturing may cap upside.

• Rebar: ¥3,500–3,700/ton (Volatility likely around maintenance impacts) • HRC: ¥3,450–3,650/ton (Cost support vs. weak auto demand) • CR: ¥3,950–4,150/ton (Tight conversion cost support) • MP: ¥3,850–4,050/ton (Shipbuilding订单支撑)

Key variables: September mill maintenance execution, auto/appliance sales data, and raw material (iron ore/coke) cost trends.

Procurement Plan

• Rebar: Consider staggered purchasing in early-to-mid September. Watch for spot dips around maintenance announcement effects. A 60-day forward cover may lock in favorable rates. • HRC: Hedge with a mix of spot and forward contracts. The range-bound market suggests accumulation near the lower end of the forecast band (~¥3,450) is prudent. • CR: Secure contracts now. Upstream processing costs are rising (Xinghan +¥40, Donghai +¥25), and further margin squeeze could push CR prices higher. Target ~¥4,000 for new agreements. • MP: Opportunistic buying is viable given strong shipbuilding demand. Lock in volumes for Q4 delivery if project timelines allow. Current levels (~¥4,070) are competitive.

Market News

• Iron ore & coke prices rise: Qingdao port iron ore up ¥2/t; coking coal firm. Supports steelmaking cost floor. (来源：mysteel, 2026-08-31) • Mill maintenance announced: Wukun, Quanzhou MinGuang, Xinjiang Kunlun schedule September outages reducing output by ~90kt total. Tightens supply. (来源：mysteel, 2026-08-30) • Auto & appliance demand softens: Car retail down 22% YoY; Sept appliance production forecast down. Weighs on manufacturing steel demand. (来源：mysteel, 2026-08-30) • Galvanized & CR base price hikes: Shandong Xinghan (+¥40), Donghai base (+¥25). Signals upstream cost push into cold-rolled chain. (来源：lange, 2026-08-31) • Transportation infrastructure investment strong: 1-7月公路水运累计投资18152亿元. Provides steady demand foundation for long products. (来源：mysteel, 2026-08-29)

Data Disclaimer

Data source: DSP database (Shanghai spot prices, DSP index, USD/CNY rate). Prices are for reference only. FOB estimates are provided by DSP based on quoted local prices and the stated exchange rate (1 USD = 6.735761 CNY as of 2026-08-31). Actual landed costs may vary due to freight, insurance, and duties.