Prices of steel products in China have seen sharp decline in recent months, which is attributable to continuous slack demand woes.

The weakening demand from downstream industries continued to take its toll on the domestic steel prices. The China Steel Price Index (CSPI) hit a full-year low of 122. 72 in October, according to the China Iron and Steel Association (CISA).

The October figure was 7.24% lower than in September. Meanwhile, all the eight leading types of steel products saw falling prices, highlighted by those of wire, rebar, and hot-rolled plates which showed the biggest drops of 9.66%, 10.60%, and 8. 67%, respectively.

The growth slowdown in China’s manufacturing sector resulted in weakening demand for steel products, contributing to the prices reduction. Demand for steel would take a downward path after entering the off-season for steel consumption, noted the CISA.

Steel prices already saw a sharp drop in October but started to rebound in the first week of November, but declined again in the second week. In response to the demand woes and prices dip, steelmakers mulled reduction in supply through shutting for maintenance or even total suspension of facilities.

China’s crude steel output for October amounted to 54.673Mt and the average daily output stood at 1.7636Mt, down 8.24% from the January-September period.

Source: China Metals e-mail