**Keywords:** Steel, PMI, Seasonality, Industrial Steel
**Overview:** Based on August steel industry PMI and manufacturing PMI data, the supply and demand fundamentals of the industrial steel market are expected to improve in September. With no premature demand acceleration observed, September's seasonal demand recovery may be more pronounced. Combined with expectations of weakened supply-side production, the industrial steel market is likely to experience upward volatility in September.
As the most important leading indicator, the PMI index holds significant importance for the steel industry. This analysis attempts to examine potential developments in the steel market for September by interpreting steel industry PMI and manufacturing PMI data.
**Steel PMI Analysis: Steel Industry Shows Slight Weakening**
According to the steel industry PMI survey and data released by the Steel Logistics Professional Committee of the China Federation of Logistics & Purchasing, the September 2025 reading was 49.80%, declining 0.70 percentage points from the previous period and falling back below the 50% boom-bust line. Looking at sub-indices, the supply-side production index fell from 51.90% to 48.00%, indicating decreased production enthusiasm. From an indirect demand perspective, the finished goods inventory index increased, with overall inventory rising again. The new export orders index reached 50.40%, up 4.30 percentage points from the previous month, maintaining a positive export outlook. The new orders index was 49.70%, down 2.20 percentage points from the previous period, suggesting the overall steel market supply-demand situation has slightly weakened. On the raw materials front, both the raw materials inventory index and purchasing volume index showed significant increases. Combined with rising prices of raw materials like coke, cost pressures on the steel side have intensified. Overall, the current steel market faces increased supply-demand pressure and rising costs, with intensified competition between fundamentals and cost factors.
**Manufacturing PMI Analysis: Manufacturing Shows Seasonal Improvement**
Data released by the National Bureau of Statistics Service Industry Survey Center and the China Federation of Logistics & Purchasing shows that the manufacturing Purchasing Managers' Index (PMI) for August 2025 was 49.40%, up 0.10 percentage points from the previous month, with overall manufacturing continuing its slight strengthening trend.
Looking at sub-indices, the important production index reached 50.80% in the current period, up 0.30 percentage points from the previous period, remaining above the 50% boom-bust line and maintaining growth in demand for upstream raw materials like steel. The new orders index was 49.50%, up 0.10 percentage points from the previous period but still below the 50% boom-bust line, indicating new orders remain in decline. However, the purchasing volume index reached 50.40%, up 0.90 percentage points from the previous period. Overall manufacturing production and purchasing both expanded compared to the previous month, with manufacturing demand for the industrial steel market showing seasonal expansion.
**Steel Price Outlook: Upward Volatility Expected**
Combining conditions in the steel industry and downstream manufacturing sector, for the current industrial steel market in September, overall steel production enthusiasm has declined, with relatively higher production enthusiasm for construction steel like rebar, while industrial steel output is expected to decline in September. On the demand side, manufacturing enterprises' production and purchasing are in an expansion phase, consistent with seasonal demand characteristics. Additionally, influenced by factors such as military parades, the steel market has not shown signs of premature demand acceleration, suggesting industrial steel market demand may be more pronounced in September. Overall supply-demand contradictions are weakening, and the industrial steel market is expected to experience upward volatility with rising prices in September.