Iron ore, chief input for producing steel is facing slump as steel producers are cutting production. The trickle down is happening now from real estate to construction to steel to iron ore. Sesa Goa which exports low quality iron ore to China is affected by major steel producers effecting a production cut. World majors like Rio Tinto, Vale had already announced production cut . There is no respite at sight. Chinese government stimulus package is yet to give results.
With Chinese government stimulus package of 4 trillian Yuan fails to provide immediate relief, more ships to unload iron ore in Chinese ports are on the increase. India, which were exporting 8 million tonnes of iron ore to China is down by 1.5 million tonnes. Indian iron price has also fallen from $85 a tonne to $ 15 a tonne.