Sluggish steel demand in China, the world’s largest consumer of the metal, resulted in 40% of mills to cut output or forced plants into maintenance mode this year, Bloomberg reported. The China Iron & Steel Association said at a press conference on Tuesday that domestic prices of hot-rolled coil dropped for seven straight weeks prior to July 16, as government measures to curb property speculation hindered demand for steel. The average import costs of the key steelmaking ingredient iron ore jumped 46.4% in China in the first half compared to a year ago. Higher costs and lower prices means steelmakers’ margins will be further reduced, making this quarter "very tough," said Luo Bingsheng, vice chairman of the China Iron & Steel Association.
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