Multiple ministries are promoting measures to combat “involution”; interpretation of the management of steel export licenses.

◎ Recently, multiple government departments—including the National Development and Reform Commission, the Ministry of Finance, the Ministry of Commerce, the People’s Bank of China, and the State-owned Assets Supervision and Administration Commission of the State Council—have intensively carried out planning and deployment to implement the spirit of the Central Economic Work Conference and have drawn up a list of key tasks for 2026. Focusing on boosting consumption, stabilizing and reversing the downward trend in investment, and fostering and strengthening new growth drivers, more incremental policies will be introduced next year in response to changing circumstances. The scale of central budgetary investment will be appropriately increased, and major projects under the 15th Five-Year Plan that meet the conditions will be implemented ahead of schedule. At the same time, we will also actively and prudently address risks in key areas. We will thoroughly tackle “involution-style” competition and vigorously regulate market order.

◎ The Ministry of Commerce and the General Administration of Customs announced that export licensing will be implemented for certain steel products, effective January 1, 2026.

(1) Interpretation by the China Iron and Steel Association: Including steel products under export licensing management is an important measure to guide the standardized export of steel products and thereby promote high-quality development of the steel industry. This initiative helps maintain the global balance between steel supply and demand and fosters trade equilibrium, while also showcasing China’s image as a responsible major country.

(2) Mysteel Analysis: The products now brought under management include both low-value-added products such as steel billets and certain high-end products, yet they do not cover all steel varieties. This reflects the policy’s approach of precise regulation, aiming to guide the optimization of export structure through licensing management rather than simply imposing overall quantity restrictions. In the short term, some enterprises may shift from exporting to selling domestically; meanwhile, companies are accelerating inventory clearance to avoid higher compliance costs once the new policy takes effect. Read more>>

◎ Starting at 12:00 on December 14, Tangshan City, Handan City, and Xingtai City will activate a Level II emergency response for severe pollution weather.

◎ The National Conference on Development and Reform was held in Beijing from the 12th to the 13th. The conference emphasized the need to adopt multiple measures to halt the decline in investment and stabilize it, as well as to appropriately increase the scale of central government investment within the budget. The conference also stressed the importance of comprehensively addressing “involutionary” competition and fostering new drivers of growth, while deepening and expanding the “Artificial Intelligence Plus” initiative.

◎ On December 12, Lan Fo’an, Party Secretary and Minister of the Ministry of Finance, presided over a Party Group meeting. The meeting pointed out that the fiscal authorities should accurately grasp the overall requirements and policy orientations for next year’s economic work, maintain an appropriate level of fiscal deficit, total debt scale, and overall expenditure, and enhance the precision and effectiveness of policies. They should make good use of all types of government bond funds and issue ultra-long-term special government bonds to continue supporting the construction of “two major” projects and the implementation of “two new” initiatives.

◎ Han Wenxiu, Deputy Director in charge of daily operations at the Central Financial and Economic Affairs Office and Director of the Central Rural Work Office, stated that next year, additional policies will be introduced and implemented in response to changing circumstances. We must continue to pursue a more proactive fiscal policy, maintaining an appropriate level of fiscal deficit, total debt, and overall spending.

◎ Xiao Weiming, Deputy Secretary-General of the National Development and Reform Commission, stated that we must accelerate the promotion of a comprehensive green transition and, starting next year, effectively and rigorously manage high-energy-consumption and high-emission projects.

◎ The Ministry of Commerce, the People’s Bank of China, and the Financial Regulatory Administration have issued the “Notice on Strengthening Coordination Between Commerce and Finance to Further Boost Consumption.” The notice highlights the need to upgrade consumer spending by enhancing financial services for large-ticket durable goods and digital products, thereby tapping into the potential for upgrading consumption patterns. It also calls for appropriately determining loan approval ratios, tenures, and interest rates, and accelerating the development of personal consumer lending business.

◎ The central bank reported that, in the first 11 months, the cumulative increase in social financing reached 33.39 trillion yuan, an increase of 3.99 trillion yuan over the same period last year. At the end of November, the balance of broad money (M2) stood at 336.99 trillion yuan, up 8% year-on-year. In the first 11 months, RMB loans increased by 15.36 trillion yuan.

◎ The central bank announced that on December 15, it will conduct a reverse repurchase operation involving 600 billion yuan through a buyback mechanism, with a term of 6 months, marking the fourth consecutive month of increased-scale renewals.

◎ The United States has signed an agreement with eight countries, including Japan, South Korea, and Australia, to safeguard the security of the rare-earth supply chain and ensure that the development of artificial intelligence technology does not rely on China. In response, Foreign Ministry Spokesperson Guo Jiakun stated that all parties should abide by the principles of market economy and fair competition and work together to maintain the stability of global production and supply chains.

◎ U.S. President Trump said that both Kevin Hassett, Director of the National Economic Council, and Kevin Warsh, former Federal Reserve Board member, are among his top choices to lead the Federal Reserve. Trump stated that he believes interest rates should be “at 1% or even lower,” and he expects to select the next Fed chair “in the coming weeks.”

◎ According to market sources, NVIDIA will hold a closed-door summit aimed at addressing the increasingly severe power shortage challenge in the AI era.

◎ On the eve of his meeting with the U.S. envoy in Berlin, Ukrainian President Zelenskyy stated that Ukraine has abandoned its goal of joining NATO in exchange for security guarantees from the West—a compromise aimed at bringing an end to the Russia-Ukraine conflict.

◎ Last weekend, the ex-factory price of Qian'an Pufang billets in Tangshan remained stable at 2,940 yuan per ton.

◎ On December 12, the nationwide spot trade volume of iron ore at major ports reached 876,000 tons, down 11.6% from the previous month. The trade volume of construction steel among 237 leading traders totaled 90,500 tons, a decrease of 1.9% from the previous month.

◎ From December 8 to December 12, the national average price of threaded steel was 3,289 yuan per ton, down 1.11% from the previous week. On the supply side, weekly production of threaded steel reached 1.7878 million tons, with inventories totaling 4.795 million tons. On the demand side, consumption amounted to 2.0309 million tons, and weekly transaction volume of construction materials reached 491,100 tons.

◎ Last week, the scope of maintenance and resumption of production at construction steel enterprises narrowed somewhat, and we expect this to result in a decline in this week’s output. Based on the average daily output of rolling mills, last week’s maintenance activities affected an output reduction of 134,400 tons, compared to a weekly decrease of 203,400 tons. This week, we estimate that maintenance activities will affect an output reduction of 112,700 tons.

◎ Last week, the blast furnace ironmaking capacity utilization rate at 247 steel mills was 85.92%, down 1.16 percentage points from the previous week. The profit margin for steel mills was 35.93%, a decrease of 0.43 percentage points from the previous week. The average daily molten iron output was 2.292 million tons, down 31,000 tons from the previous week.

◎ Last week, the average capacity utilization rate of 87 independent electric arc furnace steel plants nationwide was 52.77%, down 1.05 percentage points from the previous week; the average operating rate was 67.73%, up 0.01 percentage point from the previous week.

◎ Seven departments have issued the "Guidelines for Building a Product Carbon Footprint Factor Database." The guidelines indicate that a preliminary product carbon footprint factor database will be established by 2027, and by 2030, a comprehensive product carbon footprint factor database with broad coverage, high data quality, and strong international influence will be essentially completed.

◎ The automotive industry strikes again against “involution”: The State Administration for Market Regulation has released a draft of the “Guidelines on Compliance of Pricing Practices in the Automotive Industry” for public comments. The document outlines price compliance requirements across all stages—from vehicle manufacturing to parts production, from pricing strategies to sales practices—and places particular emphasis on addressing prominent issues such as failure to display prices clearly as required and deceptive promotional activities in new-car sales. Following the release of the draft, automakers including BYD, BAIC Group, and XPeng Motors have swiftly responded.

◎ Luo Tiejun, a member of the Standing Committee of the Party Committee and Vice President of the China Iron and Steel Association, called at the inaugural 2025 Automotive Steel Supply-Demand Symposium for steel companies to respond to the nation’s efforts to combat “involutionary” malicious competition, thereby safeguarding both industry interests and consumer interests. He also expressed hope that automotive OEMs and the broader automotive industry would recognize and support these efforts.

◎ The “Polysilicon Capacity Integration and Acquisition Platform” has officially been established. In the future, the silicon material production capacity planned to be retained by relevant enterprises will not exceed 1.5 million tons. The China Photovoltaic Industry Association stated that the platform is designed to operate under a dual-track model—“debt-assumption acquisitions combined with flexible capacity reduction”—and aims to address the issue of “involutionary” and malicious competition across the entire industry.

◎ Shandong Province Fires the “First Shot” in Stabilizing the Property Market and Reducing Housing Inventory: On December 12, the province released the “Guiding Opinions on ‘Old-for-New’ Housing Exchanges,” which propose enriching “new-exchange” models, broadening channels for disposing of existing homes, and adopting multiple measures to reduce the costs associated with home exchanges.

◎ As the futures price of copper has surpassed US$10,000 per ton this year, China is accelerating the promotion of “aluminum replacing copper” in air conditioners and the development of related standards. The group standard “Construction Specifications for Aluminum Tube-Fin Heat Exchanger Production Lines for Room Air Conditioners,” issued by the Chinese Society of Refrigeration, has already been released, and two additional group standards are currently under preparation.

◎ At the 3rd meeting of the first session of the Lithium Iron Phosphate Materials Branch of the China Association for Chemical and Physical Power Sources, held recently, it was learned that several leading companies have begun adjusting their product prices. Recently, the lithium iron phosphate industry has been experiencing a wave of intensive price hikes.

◎ According to the Shanghai Futures Exchange, after careful consideration, effective from the trading session on December 17, 2025 (i.e., the night session on December 16), the intraday closing-position transaction fee for tin futures contract SN2601 will be adjusted to RMB 6 per lot.

10:00 China’s November value-added of industrial enterprises above designated size and retail sales of consumer goods, etc.

21:30 Canada November Unadjusted CPI Year-on-Year Rate

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