Chinese steel cuts raise hopes for Korean steelmakers

Korean steelmakers are cautiously hopeful that voluntary production cuts by about 45 Chinese mills could ease the oversupply and price pressure that have squeezed their margins, although the impact will depend on how deeply and consistently output is reduced. “Reducing inventories and cutting production is certainly welcome and positive for the Korean steel industry,” an industry official said. “If China were to make a drastic cut of 200 million or 300 million tons, I think it would have a very positive effect on steelmakers around the world, including those in Korea.” The China Iron and Steel Association (CISA) recently called on about 45 steelmakers, including China Baowu Group, Ansteel Group, HBIS Group and Shougang Group, to adjust production and inventories based on actual orders and profitability rather than maintaining full production despite weak demand. The move comes as weak property and construction demand has left Chinese mills with high inventories and deteriorating profitability. China’s crude steel output fell 3 percent year-on-year in the first half of 2026, whil