Commodities Buzz: Chinese Steelmakers Suffering From Overcapacity

Chinese steelmakers are dealing with a substantial oversupply problem that will likely force them to transform the way they do business. A report posted on the China Iron and Steel Association (CISA)'s on Monday said that a weak economic recovery, low demand, high prices for raw materials and high steel output have caused an oversupply of steel products.
The National Bureau of Statistics has already showed that steel output increased by 11.3 percent year on year to 91.19 million tonnes in May. In the first five months of the year, steel product output rose 10.8 percent year on year to reach 426.16 million tonnes.
Meanwhile, the Complex Steel Price Index (CSPI) released by CISA dropped by 13.35 percent year on year to hit 101.83 by the end of May, down 3.71 percent from that of April.
Source by Commodity Insights