China’s steel exports hit a record in December, capping a historic year. Overseas shipments climbed despite escalating trade frictions and widespread predictions of a downturn. This surge underscores the intense pressure on Chinese mills as domestic construction demand falters, forcing them to seek buyers abroad at competitive prices.

The record export volume intensifies global trade tensions. Major producers like Japan, South Korea, and the European Union have raised alarms over the flood of cheap Chinese steel. They argue this surge is driven by weak domestic demand and state-supported production, distorting international markets and threatening local industries.

Beijing faces a difficult balancing act. It needs to support its massive steel sector and protect manufacturing jobs amid a slowing economy. However, this export drive risks triggering more retaliatory tariffs. Markets will watch for any policy shifts from Chinese officials aimed at curbing production or stimulating domestic consumption.