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In the second quarter GDP growth rate in three years for the first time breaking eight in June PMI index hit a 7-month low, the steel major downstream industries, real estate, machinery, shipbuilding, home appliances, and so have not yet seen signs of stabilizing improved the slow growth in demand for steel. Steel production in the first half of this year growth in crude steel production increased only 1.8 percent growth rate has decreased significantly, some species also experienced negative growth, but the current 200 tons of daily production levels relative to demand still more high. Steel demand and supply presented "half water, half of the flame" phenomenon, in addition, this  phenomenon also exists in other areas of the steel industry.

Steel prices stumble endlessly, while the high yield

Commodity economy, the price determined by supply and demand. Oversupply the price decline, which in turn promote the regulation of the relationship between supply and demand to rebalance near. This situation had occurred in 2010 and 2011, steel prices experienced a decline of about 15% in April-July 2010, production delay of three months from July to reduce average daily crude steel reduced to 1.84 million tons from the highest 1.6 million tons. August 2011 to February this year, steel prices is also decreased by approximately 15% of production decreased from a maximum of 1.99 million tons from last September to 1.66 million tons. This year, as of July 19, the the rebar national average compared with the high point in April fell 12 percent, but lower yield has yet to appear. Demand is unlikely to improve the situation, the industry generally hopes to lower production to improve the supply and demand, for now, the signs of time will be postponed again. If the output still can not reduce, the steel city have to wait for policies to promote a slightly improved in the next demand.