CISA outlines main reasons for steel price crash

1. Lapse of market confidence

2. Disappearance of the function of the circulation and end users as a reservoir

3. Loss of benchmarking in the producers" pricing.

Mr Qi said "Chinese steel price has plunged after a surge. By November 21st, the domestic composite steel index stood at 101.49, down 18.89% from end of last year and the steel price level has gone close to that posted in 1994."He said that though it"s a fact that the steel demand is declining amid financial crisis, the price dives have already got derailed from supply and demand correlation.

He added that the substantially progressing consumption of social inventory is the main reason behind the recent price rebound, and the current social stock, some 80 million tonnes is at a rational level.