China’s Steel Billet Exports Surge Amid Middle East Market Decline, SMM Reports

China’s steel billet exports have experienced a significant year-on-year increase, according to a recent analysis by Shanghai Metals Market (SMM). This growth is attributed primarily to prior geopolitical conflicts that caused logistical bottlenecks and elevated insurance premiums in key billet and slab production regions, particularly affecting local Middle East electric arc furnace (EAF) mills and blast furnace (BF)-based plants.

These disruptions led to a temporary vacuum in overseas billet supply, prompting global buyers to increase inquiries with Chinese suppliers. Purchasing sentiment strengthened notably in Southeast Asia, where demand for steel products has risen. SMM’s order-taking survey indicates that exports are expected to remain elevated in the near term.

A noteworthy development is Vietnam’s impending implementation of anti-dumping duties on China’s hot-rolled coil (HRC), effective April 17. This policy triggered a surge in HRC exports to Vietnam in April, as buyers rushed to front-load shipments ahead of the deadline. However, SMM anticipates a decline in exports to Vietnam in May following the duty’s enforcement.

Among destination countries, Djibouti recorded the largest increase in steel imports. Its product mix is dominated by HRC (42%) and steel billet (30%). Serving as the “Gateway to East Africa” and a major transshipment hub, Djibouti itself lacks substantial steel consumption capacity. The surge is largely due to repeated tensions in the Red Sea, which have forced large vessels to unload and transship cargo either in the Mediterranean or south of the Suez Canal. Djibouti acts as a secure transit point for East African infrastructure projects, such as those in Ethiopia, and facilitates onward shipping to North Africa via smaller vessels.

Singapore also saw a significant increase of 290,000 metric tons in steel imports. This rise is mainly attributed to centralized procurement and trade settlement activities linked to ASEAN and Chinese-invested construction projects within Singapore. The demand primarily supported exports of bars, wire rods, and other finished steel products related to infrastructure development.

Conversely, the United Arab Emirates (UAE) experienced a sharp decline in steel imports, dropping by 870,000 metric tons. Saudi Arabia’s imports also fell by 450,000 metric tons. These decreases are primarily due to ongoing geopolitical uncertainties in the Middle East, compounded by earlier excessive stockpiling by major buyers aiming to mitigate logistics risks. This has pushed the regional market into a defensive phase characterized by destocking and slower purchasing activity.

Looking ahead, SMM reports that April’s steel export orders remained at a high level despite a slight month-on-month dip of 0.57% due to holiday effects. Shipping activity to the Middle East is gradually recovering, while slab orders for Southeast Asia saw significant growth in April.

Considering these factors—an export orders index returning to expansion territory, a sustained export price advantage, and strong order performance—SMM projects that China’s steel exports will continue to grow in May. Steel billet is expected to maintain its dominant position in export volumes.

This analysis is based on SMM’s internal database models and publicly available information, including industry news, customs data, and market communications. SMM retains all intellectual property rights to the report content and reserves the right to pursue legal action against unauthorized use.

Data Source Statement: Except for publicly available information, all other data have been processed by SMM based on market communication and internal modeling. These data are for reference only and do not constitute decision-making recommendations.