The Purchase Management Index (PMI) of steel industry in China dropped by 6.9% to around 48.8% in May and fell back to the interval contraction, according to China Federation of Logistics & Purchasing (CFLP) report.
Moreover, it is expected that the stock of steel product has increased rapidly to reflect the sluggish demand for current steel market. However, CFLP expects the steel prices would stop dropping sharply in next few months.
From the point of view of the report, Chinese government will implement some policies such as infrastructure investment, Energy Efficient Appliance Rebate Program to boost the demand for steel market