China October steel PMI falls to six-month low as resources prices slump, order growth slows

31 October 2017

Growth in China’s booming steel industry fell to a six-month low in October as a government crackdown on winter air pollution sent prices of some raw materials tumbling and new order growth slowed, according to a sector survey released on Tuesday.

The Purchasing Managers’ Index (PMI) for the steel sector fell to 52.3 in October from 53.7 in September, data from the China Federation of Logistics & Purchasing (CFLP) showed.

But it held for a sixth month above the 50-point mark that separates growth from contraction.

A sub-index for new orders fell sharply in October to 55.9 from 60.6 in September.

A reading on raw material purchase prices in October fell to 44.1 from 60.2 the previous month, indicating prices fell after rising strongly earlier in the year.

China has posted better-than-expected economic growth of nearly 6.9 percent through the first nine months of this year, fueled largely by a recovery in its industrial and manufacturing sector due to strong government infrastructure spending, a resilient property market and unexpected strength in exports.

Recent data, however, showed property and construction activity were starting to cool under the weight of repeated government measures to curb heated housing prices.