Chinese Steel Mills Pivot to Saudi as Trade Curbs Rise Elsewhere

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(Bloomberg) — Chinese steelmakers are still flooding the world with record exports, as a rising tide of protectionism is offset by resilient demand in Southeast Asia and growth in new markets in the Middle East.

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Saudi Arabia has emerged as the hot destination for 2025. Shipments of the metal to the kingdom are up 41% in the first nine months from a year earlier, the biggest jump to any major market, according to Bloomberg calculations based on Chinese customs data. 

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That’s helped Chinese steel mills defy expectations that they would struggle in 2025 due to rising tariffs and antidumping probes. Overall exports in the first 10 months of the year are at 97.76 million tons, surpassing the 92.05 million tons in the same period in 2024, and putting them on track for another all-time annual high.

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Vietnam and South Korea, which have imposed curbs on imports of the metal from their giant neighbor, saw the biggest drops in volumes, although remained China’s top two markets. There was strong growth in the Philippines, Indonesia and Thailand, while the Middle East, and to a lesser extent Africa, emerged as new drivers of demand. 

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Chinese overseas investment, partially under its Belt and Road initiative, has laid the groundwork for much of this consumption. Beijing’s spending in Saudi Arabia and the United Arab Emirates has surged to a combined $86 billion over the last decade, and much of that money has flowed into steel-intensive sectors like energy and transport, according to Jing Zhang, a senior research analyst at Wood Mackenzie Ltd.   

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“Chinese steel export routes are shifting toward the Middle East and Africa,” she said. “The product mix reflects this shift,” with exports of steel tubes and long products that are more commonly used in infrastructure already surpassing last year’s totals, a trend that’s likely to continue, Zhang said.

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Exports of long steel products to Saudi Arabia almost doubled from a year earlier, while shipments of semi-finished steel grew more than sixfold. Whether the increased demand can continue is questionable, however. The kingdom is backing away from its $500 billion plan for a futuristic city called Neom on the Red Sea, and focusing more on areas like artificial intelligence and high-tech manufacturing.

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The country data, which lags behind the overall export figures, show a rerouting of steel exports to markets with fewer restrictions, according to Bloomberg Intelligence. Nations that had or are planning tariffs on Chinese steel accounted for about 45% of exports in the first nine months of this year, down from 54% in the same period 2024, BI said in a note. 

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For now, China’s steel export strategy is paying off. But with global trade tensions simmering and domestic demand still weak, the sustainability of the boom in shipments may depend on how long the Middle East remains a willing buyer, and if Southeast Asia can maintain robust economic growth rates.