Futures have fallen by more than a third this year, tumbling almost 10 per cent last week alone, with pressure ramping up as flagging steel consumption batters loss-making Chinese mills. Still, steel-buying typically picks up after the summer, which could provide a respite for producers if it happens.
Consumption of steel in China has weakened because of the country’s protracted real estate slowdown, with the world’s biggest steel producer, China Baowu Steel Group saying the industry could be facing a worse crisis than the downturns in 2008 and 2015.
While exports and growth in other sectors are softening the blow, cuts to steel output have left the iron ore market saddled with excess supply.
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