BEIJING : The government-backed China Iron and Steel Association (CISA) has urged domestic steelmakers to cut production following rapid price drops to help ensure a stable cash flow.
Domestic steel prices have sunk, posing severe challenges to steel mills, it said at a meeting with several steelmakers on Monday.
Rebar on the Shanghai Futures Exchange has dropped from late March by nearly 11 per cent to 3,685 yuan ($532.32) a tonne on Tuesday.
Representatives from 16 steelmakers and the CISA attended the meeting, the CISA said in a statement on its WeChat account on Tuesday.
Meanwhile, some steelmakers in Northwest and North China have begun maintenance work on blast furnaces after suffering losses, consultancy Mysteel and Shanghai Metals Market (SMM) said in reports.
"Mills in these regions have faced great financial pressure due to high steel inventories," said Connie Zhang, steel analyst at consultancy SMM.
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