Mills brew production cuts

Steel prices have seen a tenth consecutive week of decline with some kinds of steel tumbling by over 1,000 yuan per ton. Most mills in Hebei Province might have been in the depth of losses. As of June 30, China's major steel prices averaged at 4,597 yuan per ton, over 400 yuan per ton lower than this year's peak level. While steel prices continued to fall, the prices of iron ore and coke were on the rise, resulting in an increase of nearly 500 yuan per ton in production costs.

To bail themselves out, these mills should strengthen their ability to create potential benefits, speed up restructurings and produce more high value added steel.