RAYC - Steel Prices In China Looking More Vulnerable In The Face Of Falling Input Costs

• Historically, China would show signs of strength driven by robust construction activity while Europe and the U.S. struggled, facing more mature markets and relatively higher levels of foreign penetration.
• But over the last couple of weeks, it is becoming clear that cutbacks are happening. Output in the second half of the year is expected to be considerably less than the record first half.
• Nasdaq reported China is ramping up pressure on steel mills, particularly in top steel producer Hebei province. It aims to limit full-year production to no more than the 2020 volume in order to cut emission levels.

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