Shanghai rebar steel prices have tumbled nearly four per cent to the lowest since late July, pressured by worries over slowing demand in top consumer China over the seasonally weak winter period.
Prices of steelmaking raw materials also sagged alongside steel on Monday, with coke also sliding almost four per cent to a five-week trough.
The most actively traded January rebar on the Shanghai Futures Exchange dropped as much as 3.8 per cent to 3,818 yuan ($US549) a tonne, its weakest since July 25.
In a sign of weakening demand, major Chinese steelmaker Baoshan Iron and Steel said on Sunday it would cut domestic prices for key steel products by as much as 200 yuan per tonne for December.
"This shows that as the winter season has kickstarted, steel demand is slowing due to weak seasonality," Argonaut Securities analyst Helen Lau said in a note.
With China's steel production not showing any signs of slowing down, Lau said profitability growth at Chinese steel producers may have "peaked and (we) expect margin erosion going forward."
Ahead of China's winter curbs where cities are ordered to reduce steel output to limit smog, the country's crude steel output averaged 2.7 million tonnes in September, a record high.
The government will release October data later this month.
The decline in steel prices came even as China's top steel-producing Hebei province asked 10 major cities to issue an orange smog alert, requiring steel mills to halve their output.
The cities were set to enforce emergency smog reduction measures from Sunday until Friday.
Coke - the processed form of steelmaking ingredient coking coal - was last down 2.7 per cent at 2,303.50 yuan a tonne.
It fell as far as 2,277.50 yuan earlier in the session, the lowest since October 8.
Coking coal gained 0.2 per cent to 1,354 yuan per tonne, after initially hitting a 4-1/2-week low. Iron ore slipped 0.7 per cent to 520.50 yuan.
An empty iron ore train has derailed in Western Australia after poor weather eroded part of the track, operator Mineral Resources Ltd said, a week after the derailing of a runaway ore train owned by global miner BHP Billiton in the state's north.
Share
