China's Baoshan suspends steel plant as demand slows

Workers at a steel factory in China The plant in Shanghai mainly produces steel plates used in ships and manufacturing

Baoshan Iron and Steel, the fourth biggest steel producer in the world, has suspended production at a plant in China as demand slows.

Baosteel, as it is known, said it closed the plant in Luojing, Shanghai, to avoid increasing operating losses.

China is the world's biggest producer of steel and prices have fallen this year.

Steel makers in China have been struggling as Beijing puts curbs on the property sector to bring down prices.

In a statement to the Shanghai Stock Exchange, Baosteel said a downturn in demand in the slab market prompted the shutdown. It did not say when production would resume.

The plant in Shanghai mainly makes steel slabs used in ships and manufacturing.

Data published by HSBC on 20 September showed that industrial activity remains subdued across China, with the purchasing managers index showing a contraction for another month.

Steel production has slowed and iron ore prices have fallen about 25% this year.

Analysts say that the low prices mean mills are under pressure and that more production cuts are expected from steelmakers in China.

More on This Story

Related Stories

More Business stories

RSS

Features

BBC © 2014 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.