China intends to maintain strict regulations on steel output and block illegal capacity expansions during its upcoming Five-Year Plan from 2026 to 2030.

According to Reuters, this policy addresses persistent oversupply and a stagnant property market. For the first time in six years, annual production is expected to drop below one billion tons, following a year-on-year decline of 4% in the first 11 months of this year.

To manage international trade tensions, Beijing will launch a licensing system for approximately 300 steel products starting in 2026. Although the National Development and Reform Commission (NDRC) advocates for industry reforms, the Japan Iron and Steel Federation (JISF) remains doubtful that these administrative permits will significantly lower export volumes or improve global prices.