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Kallanish Kallanish

Knowledge matters Knowledge matters

September, 22nd 2020

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CSI: Can China stave off a summer meltdown? (June 6, 2019)

As China’s steel market peaks, mills are caught between rising raw materials prices and falling steel prices. Because they are still profitable however, they are still producing at high rates. Unless production falls or demand is stronger than expected, inventories will increase, prices fall and exports become more competitive.

The Chinese government meanwhile is weighing up its options in the face of the economic slowdown. The context of the trade , pressure on its currency and the prospect of rising inflation is only complicating its decisions.

The question now is, will demand and sentiment be sufficiently supported in the coming weeks to prevent prices falling to dangerous levels?