In 2025, China's stainless steel industry maintained steady growth amid complex internal and external environments. The pace of capacity expansion slowed significantly, new commissioning was concentrated in leading enterprises, and market expectations became more rational. Looking ahead to 2026, the industry is expected to enter a stage of moderate growth, with capacity release still dominated by existing projects, and the output is projected to increase by 2.73%.

I. 2025 Crude Stainless Steel Output Up 4.54% Year-on-Year

In 2025, the crude stainless steel output of 43 domestic stainless steel mills reached 39.9964 million metric tons, an increase of 1.7386 million metric tons or 4.54% year-on-year. Specifically: Series 300 stood at 20.9829 million metric tons, up 1.1289 million metric tons or 5.69% year-on-year; Series 400 was 7.3578 million metric tons, an increase of 341,500 metric tons or 4.87% year-on-year; Series 200 reached 11.6557 million metric tons, increasing by 268,200 metric tons or 2.36% year-on-year.

The first quarter coincided with the traditional Spring Festival, and downstream demand entered a seasonal slump. Some steel mills carried out maintenance and production cuts as usual; however, driven by the generally optimistic market expectations at the beginning of the year, many steel mills chose to end or postpone maintenance in advance, resulting in a limited overall output reduction in the first quarter.

In the second quarter, the international market environment underwent significant changes. Steel mills' profit margins were squeezed by both the sales side and the cost side, prompting some mills to implement or advance their annual maintenance and environmental protection renovation plans. As a result, crude steel output showed a monthly downward trend in the second quarter.

In the third quarter, crude stainless steel output first declined and then rose. At the beginning of the quarter, affected by factors such as the traditional off-season, weak demand expectations and maintenance, output fell month-on-month. With the passage of time, driven by positive expectations, most steel mills raised their production plans.

In the fourth quarter, the overall domestic crude stainless steel output dropped month-on-month. This was mainly due to seasonal factors: as temperatures gradually cooled, outdoor projects in northern China successively entered the winter shutdown period and extended southward, directly weakening the demand for stainless steel and leading to a corresponding reduction in output.

II. Slower Capacity Growth in 2025, Trend to Continue in 2026

In 2025, the growth rate of new stainless steel melting capacity in China slowed down. Affected by weakening market conditions and declining profitability, many steel mills have postponed their original commissioning plans. All 2 million metric tons of new capacity added in 2025 came from Tsingshan Group, which started commissioning at the end of 2024, gradually reached full capacity in 2025, and was mainly focused on Series 300 stainless steel production. Naiman Jing'an's planned 1.2947 million metric tons of capacity, after completing trial production and launching pilot sales in 2024, has not taken further production actions due to cost control and sales performance considerations.

Looking ahead to 2026, the pace of crude stainless steel capacity release in China will continue to slow. Currently, capacity expansion has entered a plateau phase. Restricted by multiple factors such as stricter industry regulation and difficulties in accessing core resources, new capacity is mainly derived from the implementation of projects approved in previous stages. Meanwhile, there are significant uncertainties surrounding existing uncommissioned capacity. Affected by stainless steel market conditions, raw material supply and profit margins, the willingness to commission new capacity is limited, and such commissioning is mainly driven by medium and large steel mills. According to Mysteel's research, the green high-end nickel-chromium new material intelligent manufacturing project for stainless steel, a joint venture between Hangzhou Iron and Steel Group and Zhenshi Group, is scheduled to be gradually put into production in the first half of 2026, with an initial monthly output of about 40,000 metric tons. After gradually reaching full capacity, the total annual capacity will reach 2.5125 million metric tons (including the existing annual capacity of 700,000 metric tons). Cangzhou Mitsubishi's 1 million metric ton capacity production line has been completed and is expected to be commissioned in 2026 after trial operation. Guangqing's 400,000 metric ton single-strand slab continuous caster production line for Series 400 stainless steel officially broke ground in September 2025 and is scheduled to be completed and put into operation in March 2026.

III. 2026 Domestic Crude Stainless Steel Output Projected to Rise by 2.73%

Driven by the release of new capacity and the recovery of existing production lines, China's domestic crude stainless steel output is expected to maintain steady growth in 2026. However, constrained by market demand and the instability of the international macroeconomic situation, the growth rate is projected to slow down compared with 2025. In addition, intensified market competition has narrowed profit margins, resulting in limited competitiveness of newly entered capacity. Small and medium-sized steel mills have mostly made structural adjustments to their output and product varieties, and the main increment in crude stainless steel production will come from leading steel enterprises.

It is estimated that in 2026, the crude stainless steel output of 43 domestic stainless steel mills will reach 41.09 million metric tons, an increase of 1.09 million metric tons or 2.73% year-on-year. Specifically: Series 300 will be 21.4829 million metric tons, up 500,000 metric tons or 2.38% year-on-year; Series 200 will reach 11.8457 million metric tons, an increase of 190,000 metric tons or 1.63% year-on-year; Series 400 will be 7.7578 million metric tons, up 400,000 metric tons or 5.44% year-on-year.