Baoshan Iron and Steel (Baosteel), the fourth biggest steel producer in the world, has suspended production at its Luojing plant in Shanghai.
Baosteel, said it closed the plant in Luojing, Shanghai, to avoid increasing operating losses.
In a statement to the Shanghai Stock Exchange, Baosteel said a downturn in demand in the slab market prompted the shutdown. It did not say when production would resume.
The plant in Shanghai mainly makes steel slabs used in ship building and engineering equipment.
Data published by HSBC on 20 September showed that industrial activity remains subdued across China, with the purchasing managers index showing a contraction for another month.
Steel production has slowed and iron ore prices have fallen about 25% this year.Analysts say that the low prices mean mills are under pressure and that more production cuts are expected from steelmakers in China.