China Steel and Iron Ore Weekly Update
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Morgan Stanley's latest weekly tracking report covers the Chinese steel and iron ore market through the week of April 16, 2026. The data reveals divergent consumption trends across steel categories. Apparent consumption for long products rose 4.2% week-over-week, reflecting renewed strength in construction activity, while flat product consumption declined 1.0%, indicating softer manufacturing demand. Rebar demand specifically climbed 4.0%.
On the supply side, weekly output for both long and flat products edged down slightly. Inventory dynamics showed continued destocking at trader levels, with steel trader inventories falling 3.0% week-over-week, though mill inventories ticked up by 1.8%. Capacity utilization improved across both steelmaking routes; blast furnace utilization reached 89.7%, while electric arc furnace (EAF) utilization climbed to 62.6%.
In the iron ore market, steel mills actively restocked inventories, pushing operational rates higher. Port inventories of iron ore marginally declined by 0.4% to 160.02 million metric tons. Meanwhile, combined shipments from Australia and Brazil increased by 1.46 million tons week-over-week, with Australian miners contributing 1.38 million tons of the total gain. The firm maintains an Attractive rating on the sector, noting that short-term supply discipline and inventory drawdowns provide fundamental support, though sustained demand recovery remains the critical variable to monitor.