GOLDEN SUN SECURITIES·2025-12-16 04:41Investment Rating - The report maintains a "Buy" rating for the steel industry, indicating a positive outlook for selected companies within the sector [6]. Core Insights - The steel industry is experiencing a divergence between strong expectations and weak realities, with production data quality declining since May 2023, impacting demand assessments [2]. - China's apparent steel consumption increased by 3.6% year-on-year from January to November, but November alone saw a decline of 3.3% [2]. - The net export of steel reached 10.218 million tons from January to November, a year-on-year increase of 7.6%, driven by strong manufacturing exports [3]. - Domestic policies are shifting focus towards basic economic fundamentals, with an emphasis on proactive fiscal policies and moderate monetary easing [4]. Summary by Sections Production and Consumption - In November 2025, crude steel production was 6.987 million tons, a year-on-year decrease of 10.9%, while the average daily production was 2.329 million tons, showing a slight month-on-month increase of 0.3% [8]. - The apparent consumption of steel in China for the first eleven months of 2025 grew by 3.6% year-on-year, with a notable decline in November [2]. Exports and Imports - Steel exports for January to November 2025 totaled 10.772 million tons, reflecting a year-on-year increase of 6.7% [8]. - The import of iron ore in November was 11.054 million tons, up 8.5% year-on-year, while cumulative imports for the first eleven months increased by 1.4% [8]. Policy and Market Outlook - The report anticipates that the focus of domestic policies will increasingly center on structural adjustments, with an expectation of continued fiscal easing and reforms [4]. - The report highlights potential investment opportunities in undervalued companies within the steel sector, such as Huazhong Steel and Baosteel, which are expected to benefit from upcoming economic cycles [4].