AsianFin -- China's steel exports are poised to decline sharply in the second quarter, raising concerns of a worsening domestic oversupply, according to analysts and traders.

A slowing global economy, intensifying trade tensions, and rising protectionism are squeezing export opportunities for the world’s largest steel producer.

Second-quarter exports could fall by as much as 20% from the first quarter, according to eight analysts and traders, who also warned that the outlook may deteriorate further in the second half of the year.

Shipments are also expected to be lower than the same period in 2024, underscoring the extent of the decline.

The downturn comes as U.S. tariffs curb transshipment routes—where Chinese steel is redirected through third countries to reach the American market—while major buyers such as South Korea and Vietnam are introducing their own duties to prevent oversupply being dumped in their domestic markets.

“There’s no doubt that overall exports will drop in Q2,” said one Chinese steel trader, who requested anonymity as they were not authorized to speak to the media.