Several steel enterprises reported strong production results for the first month of 2026, achieving a positive start to the year. Fangda Dagang exceeded its production targets for pig iron, crude steel, and steel products by 105.01%, 110.63%, and 110.71% respectively, with multiple core indicators reaching new highs. Yangchun New Steel achieved a production-to-sales ratio of 101% for the entire month of January, marking a new breakthrough in sales channels.
Huatai Securities released a research report stating that recent discussions during the "Two Sessions" regarding voluntary emission reductions may signal that dual-carbon policies are entering a substantive implementation phase. The normalization of supply constraints could become a core driver for profit recovery in the industry, with the steel sector expected to recover in 2026. The industry is currently at a historical low, coupled with a long-term decline in crude steel production and continuous optimization of downstream demand structure. Steel is entering a recovery cycle dominated by policies, supply contraction, and amplified profit elasticity.
CICC published a report noting that South Korea's final ruling on the anti-dumping case against Chinese hot-rolled coil has resulted in an agreement with China on a price undertaking scheme, replacing anti-dumping duties with price commitments. This substitution of high anti-dumping duties with price commitments enhances order continuity and predictability for export enterprises. Constraining minimum prices may reduce space for low-price volume grabbing and improve the order of export quotations, potentially restoring the "reservoir" function of exports. Combined with expectations of looser domestic real estate policies, this is expected to support market sentiment and drive industry recovery.
From an inventory perspective, weak winter stockpiling has kept inventories at historically low levels. If March sees a recovery in transactions driven by the resumption of work and production, it could catalyze a phased upward trend.
Galaxy Securities stated in a research report that the supply-demand dynamics in the steel industry are improving, with growing expectations for policy catalysts. The "anti-internal competition" in the steel sector is gradually deepening, with orderly capacity exits progressing and industry concentration steadily increasing. Meanwhile, steel industry policies emphasizing stable growth focus on green and intelligent development, as well as technological innovation. High-quality special steel and specialty alloy steel for high-end equipment possess scarcity value. Recommendations include focusing on: 1. Companies actively engaged in mergers and reorganizations to enhance synergistic effects and strengthen leading positions; 2. Those continuously optimizing product mix and maintaining stable high dividend payouts; 3. Enterprises with high technological barriers against internal competition, showing significant potential for earnings and valuation recovery.
Related Hong Kong-listed steel stocks include: CHONGQING IRON (01053), MAANSHAN IRON (00323), ANGANG STEEL (00347).