China weekly: Steel prices edge lower w-o-w ahead of lunar new year slowdown

• Weak pre-holiday demand keeps steel prices subdued
  
  
• Market awaits post-Lunar New Year buying pickup
  
  

Chinese steel prices declined in the week ended 13 February, dragged down by softer raw material prices and weakening demand ahead of the Lunar New Year holidays in the region. Domestic HRC and rebar prices fell w-o-w, while key raw material prices such as iron ore, billet, and coking coal also edged down over the same period.

Market sentiment weakened further this week, with rebar futures hovering near a 6 month low on the Shanghai Future Exchange amid seasonal pre-holiday pressure. Spot market activity remained subdued, as buyers largely stepped back and demand continued to soften. On the supply side, production also eased, leading to a simultaneous slowdown in both supply and consumption.

1. Iron ore spot prices edge down w-o-w: Iron ore fines benchmark prices for Fe 61% fell by $2/t w-o-w to $97/dmt CFR China on 13 Feb as trading activity remained subdued. Demand for iron ore materials stayed thin, with market participants gradually stepping away ahead of the upcoming Lunar New Year holidays. Buying inquiries and bids were limited, as many traders have already begun their holiday break.

a) Spot pellet premium stable w-o-w: Spot pellet premium for Fe 65% grade pellet held firm at $16.35/t CFR China on 11 February.

b) Spot lump premium inch up w-o-w: Spot lump premium edged up w-o-w to $0.0600/dmtu on 13 February.

2. China market steady; Seaborne coking coal prices ease on weaker demand: China's domestic coking coal market remained steady, with prices in Tangshan, Changzhi and Lliang unchanged d-o-d. Holiday mine closures limited supply, but weak trading activity and completed winter restocking by steel mills kept demand subdued, leaving the market stable with a slight downside bias.

In contrast, BigMint's PHCC index fell $5 w-o-w to $263/t CNF Paradip on 13 February 2026 on softer Australian offers and weak Chinese demand.. Similarly, Australian premium hard coking coal (PHCC) prices declined by $4/t to $249/t FOB, reflecting softer seaborne demand and cautious purchasing by end-users.

3. Chinese billet prices fall w-o-w as pre-holiday slowdown and weaker demand weigh: China's billet prices fell RMB 10/t ($1/t) w-o-w to RMB 2,900/t ($420/t) on 13 February 2026, compared with RMB 2,910/t ($421/t) on 06 February, as pre-Lunar New Year caution and slowing demand pressured the market. Early-week sentiment was soft amid rising inventories and reduced trading activity, with many mills and traders entering holiday mode. Raw material trends were mixed, as iron ore corrected after mills completed restocking, while coke remained relatively stable despite weaker futures.

Midweek, limited transactions and production cuts-particularly among EAF mills-kept physical activity subdued. Export activity showed pockets of resilience, though overall buying interest remained cautious. Toward week-end, thin liquidity and risk control measures capped any recovery momentum. SHFE rebar futures edged down RMB 10/t ($1/t) w-o-w to RMB 3,059/t ($443/t), reflecting muted participation and holiday-driven uncertainty across the steel complex.

4. Domestic HRC prices edge down w-o-w: Domestic HRC prices in China declined by RMB 10/t ($1/t) w-o-w to RMB 3,040/t ($440/t) on 13 February, down from RMB 3,050/t ($441/t) on 6 February, following the drop in SHFE HRC futures (May 2026 contract), which fell by RMB 34/t ($5/t) w-o-w to RMB 3,223/t ($466/t) on 13 February, compared with RMB 3,257/t ($471/t) a week earlier. Meanwhile, China's HRC export remained stable w-o-w at around $465/t FOB.

The weekly decline in domestic prices reflected weak pre-holiday demand and muted spot activity ahead of the Lunar New Year. Market sentiment remained subdued as downstream buyers slowed operations, while mills offered limited volumes, resulting in few actual transactions. Rising inventories further weighed on the market, reinforcing a cautious, wait-and-watch stance until participants return after the holiday.

5. Rebar prices fall w-o-w: China's rebar prices fell marginally w-o-w by RMB 10/t ($1/t) to RMB 3,110/t ($450/t) on 13 February from RMB 3,120/t ($451/t) a week earlier. The drop mirrored the weakening trend in SHFE futures, with the May 2026 rebar contract falling by RMB 36/t ($5/t) w-o-w to RMB 3,054/t ($442/t) on 13 February from RMB 3,090/t ($447/t) on 6 February.

The decline was largely driven by weak spot demand ahead of the Lunar New Year holiday, as construction activity slowed and most market participants stepped back from trading. Sentiment weakened further after rebar futures fell to their lowest level in six months on the Shanghai Futures Exchange, adding pressure on spot prices. Muted buying interest, coupled with rising inventories, kept transactions subdued, reinforcing the downward trend across both futures and the spot market.

China's Shagang Steel has continued to keep its long steel prices unchanged for mid-Feb 26 sales, with no price revisions announced since 11 Sep'25. Prices of rebars, coiled rebars, and wire rods are as follows:

• Rebars (16-25 mm): RMB 3,450/t ($500/t)
  
  
• Coiled rebars (8-10 mm): RMB 3,560 ($516/t)
  
  
• Wire rods (6-10 mm): RMB 3,470/t ($503/t)
  
  

Outlook

China's steel market is expected to remain under pressure in the near term, amid weak demand and the seasonal slowdown associated with the Lunar New Year holidays. While production is easing, elevated inventories are keeping market participants cautious. The market's direction will largely depend on two factors: the strength of demand recovery after the holidays and a sustained decline in inventory levels, which could indicate improving fundamentals. A clearer trend is likely to emerge as trading activity gradually picks up and participants return.