Key Takeaways
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- China’s steel exports hit record levels, with 97.76 million tons shipped in the first 10 months of 2025, exceeding last year’s pace.
- Saudi Arabia has become the fastest-growing destination, with shipments up 41% year-over-year — the largest increase among China’s major markets.
- Southeast Asia and the Middle East are absorbing volumes once bound for markets imposing tariffs, such as Vietnam and South Korea.
- The pivot reflects both Belt and Road-driven infrastructure demand and China’s need to offset weak domestic consumption.
- Long-term sustainability is uncertain as Saudi Arabia scales back megaprojects like Neom and shifts focus toward AI and manufacturing.
China’s Steel Export Engine Keeps Running
Despite global protectionism, Chinese steelmakers continue to flood world markets with near-record exports.
Between January and October 2025, outbound steel shipments totaled 97.76 million tons, outpacing the same period in 2024 and setting up for a new all-time annual high.
The resilience comes even as multiple trading partners have imposed tariffs or anti-dumping measures. China’s producers are compensating by diversifying destinations — particularly in the Middle East.
Saudi Arabia Emerges as the Growth Market
Shipments to Saudi Arabia jumped 41% in the first nine months, making it the standout market for Chinese steel in 2025.
Exports of long steel products — used in infrastructure — have nearly doubled, while semi-finished steel exports grew more than sixfold.
Beijing’s decade-long $86 billion investment push in Saudi Arabia and the UAE under the Belt and Road Initiative has created a foundation for demand, especially across energy, transport, and construction.
“Chinese steel export routes are shifting toward the Middle East and Africa,” said Jing Zhang of Wood Mackenzie. “The product mix reflects this shift.”
Trade Barriers Shift Export Geography
China’s steel rerouting strategy is evident in customs data:
- Markets imposing or planning tariffs accounted for 45% of exports, down from 54% a year earlier.
- Vietnam and South Korea — both tightening import curbs — saw sharp volume drops but remain top destinations.
- Rising demand from Philippines, Indonesia, and Thailand is providing secondary support.
Bloomberg Intelligence notes this geographic realignment as Chinese exporters move toward markets with fewer restrictions and higher infrastructure spend.
Saudi Demand May Be Peaking
Analysts caution that the Saudi-led boom may not last.
The kingdom is scaling back its $500 billion Neom megacity, redirecting resources toward AI, high-tech manufacturing, and defense initiatives.
These sectors are less steel-intensive, which could slow Chinese export growth in the coming years.
Broader Context
China’s steel boom underscores its industrial overcapacity problem — domestic demand remains soft while production stays elevated.
With the U.S., EU, and regional partners tightening trade measures, Beijing’s exporters are turning to newer, politically aligned markets to absorb excess supply.
The strategy is effective for now — but vulnerable to future policy and demand shifts in the Middle East.
