According to the data issued by China's Iron and Steel Association (CISA), China's crude steel output has finally started to drop down, with the average daily output declining to 1.805 million mt in May, down 20,000 mt compared to the April level. China's average daily crude steel output was 1.784 million mt in late May, slightly down compared with 1.8 million mt in the middle of the same month.
Currently, in China only small-sized steelmakers in the north of the country have been reducing production. Meanwhile, large-sized mills in China are reported to be reluctant to cut production though some are busy with overhauling works.
Meanwhile, 56 million mt of iron ore imports were unloaded at Chinese ports in May, down 2.5 percent year on year, marking the first decrease since January 2009, according to the figures issued by China's Ministry of Transport.
As of June 9, the transaction prices for iron ore imports had declined to around $150/mt; however, this level was unable to attract the interest of Chinese buyers. According to insiders, in recent days most domestic mills have been purchasing only in line with their needs, keeping their inventories at low levels so as to avoid unnecessary risks. In fact, most leading mills and traders have not imported any iron ore for several weeks.