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Positive Steel Market Outlook in Asia: Activity Gains Amid CBAM Dynamics

Recent trends in the Asian steel market reveal a positive sentiment, driven by anticipated changes related to the EU Carbon Border Adjustment Mechanism (CBAM) and evolving supply-demand dynamics. Notably, Romania’s long steel prices have risen due to “Romanian rebar prices edge higher due to CBAM, demand shows signs of recovery,” indicating a market adjustment in anticipation of regulatory impacts. While the European market adjusts, it reflects in the actions of Asian producers, as evidenced by the increased activity at key steel plants.

Bar chart and satellite map of steel production activity in Asia

The Ch’ollima Steel Complex in Korea exhibited volatility with a peak activity of 45% in July, likely due to rising expectations in steel demand amid CBAM discussions, as noted in “EU steel plate producers seek price rises as CBAM pressure mounts, but market tepid.” Activity waned to 35% by October, suggesting adaptive responses to shifting market conditions without a clear linkage to the aforementioned regulatory developments.

Conversely, Guangdong Yuebei United Steel Co., Ltd. maintained a steady activity level, peaking at 58% in June before stabilizing around 50% in the following months. This plant, focused on finished rolled products like rebar, indicates solid market positioning amidst fluctuating demand, despite ties to rising CBAM pressures expected for European imports.

Habas Aliaga, operating solely on electric arc furnace technology, showcased a consistent performance of 58% throughout the measured period, demonstrating resilience in the Turkish market which, according to “Oversupply, rains drag Indian HRC prices lower in 2025,” creates competitive conditions for exports.

The observed stability in Asian plant activity levels resonates with the trends where EU producers seek price increases but experience muted demand due to potential CBAM impacts.

Given these developments, it is advisable for steel buyers in Asia to refine procurement strategies by:

  1. Expanding Long-term Contracts: Leverage the rising domestic prices and stability in Asian production to secure favorable terms before potential CBAM-induced price adjustments impact the market.

  2. Monitoring Import Opportunities: With potential oversupply dynamics highlighted by the downturn in Indian HRC prices, buyers should consider short-term opportunistic contracts for imports from competitive markets like India and Turkey.

  3. Localized Sourcing: Align procurement more closely with domestic steel markets that have shown resilience, particularly in rebar, to mitigate risks associated with potential disruptions from upcoming regulations in Europe.

Actions tailored towards securing contracts aligned with production forecasts could enhance supply chain stability in light of evolving market conditions driven by regulatory changes and regional dynamics.