Domestic Pig Iron Prices May Move Lower in the Second Half of 2026

The pig iron market saw N-shaped fluctuations in the first half of 2026. Prices rose in Q1. Restocking demand and post-festival work resumptions pushed prices up. Prices fluctuated in Q2. Supply recovery, cost changes and off-season demand affected prices in turns. Prices fell first, then rose, and finally stayed flat. Supply exceeded weak demand through the first six months. Rising inventories stopped prices from jumping too high. Looking to the second half of the year, demand will shift between slow and busy seasons. The pig iron market will swing within a fixed range. Prices have little room to rise. We still need to watch out for price drops.

Domestic Pig Iron Prices in the First Half of 2026

Q1: Pig iron prices moved higher little by little. Factories resumed production from mid-February to late March after the Spring Festival. Market players held optimistic views on national economic policies. Market mood turned better. Downstream market demand picked up. Pig iron prices remained firm.

Q2: National pig iron prices fluctuated sideways. In May, coke prices went up and lifted production costs. Downstream factories bought basic stock. Prices bounced back and recovered most April losses. In June, coke prices kept rising. This set a bottom for pig iron prices. But downstream buyers did not increase purchases enough. Prices failed to rise further. Most market players waited and watched.

Supply Patterns and Trend Analysis for H1 2026

Pig iron factories adjusted production rates in H1 2026. Changes came from downstream demand, costs and profits. In Q1, factories shut down blast furnaces for maintenance and cut output seasonally around the Spring Festival. Capacity use first rose then fell. Blast furnace operating rates of surveyed firms stood between 45% and 55%. In Q2, factories earned decent profits and received more orders. Idled blast furnaces restarted one after another. Capacity use quickly jumped above 65%.

As of June 25, blast furnace capacity use of 44 surveyed national pig iron firms hit 65.35%. The yearly peak reached 68.55%. The yearly low was 47.86%. The gap between peak and low was 20.69%. Now most pig iron factories focus on stable output and steady cash flow. Their profits shrink, but they rarely cut output on purpose. They only reduce production when prices drop below cash production costs.

In late June, some iron mills carried out blast furnace maintenance due to high costs. Weekly capacity use and output fell from the previous week. But only a small part of production capacity was affected. Supply stayed at a high level. Excess supply still weighed on prices.

Supply Forecast for H2 2026

Capacity use of pig iron factories hit high levels in H1. In Q3, some blast furnaces that stopped production earlier will restart. Profit margins will shrink further. Prices may fall below cash costs. Factories will carry out more blast furnace maintenance then. But large-scale output cuts are unlikely. Pig iron supply will remain high. Some factories plan annual blast furnace maintenance in Q4. The impact on total output will be limited.

Overall, national pig iron capacity use will follow a W-shaped trend in H2 2026. Total pig iron output will reach 6.5 million to 7.5 million tons in the second half.

Forecast of Factory Inventories in H2 2026

Factory inventory buildup speeds up rapidly at present. Inventories will stay high in Q3. In H2, supply growth will slow down. The traditional busy season “Golden September and Silver October” will arrive. Pig iron demand will pick up for a period. The speed of inventory accumulation will slow down. High inventories will make factories less confident to keep prices high.

Supply and demand games will remain the core factor of the pig iron market in H2 2026. But the market situation will get slightly better. On the supply side, more blast furnace maintenance will lower capacity use. This is clearly good for prices. On the demand side, the September-October busy season will bring temporary restocking demand. But terminal demand will not surge sharply. Compared with H1, the extreme state of strong supply and weak demand will ease in H2. Both supply and demand will turn soft and reach a marginal balance.