Via Bloomie:
“China’s real estate sector is the biggest X-factor for the steel market globally this year,” Ivan Szpakowski, chief investment officer at Academia Capital LLC, said in a phone interview from North Carolina last week. “We’ve clearly turned the corner into a downward phase of the property cycle, and I do think there is a real risk for steel that we go back toward where we were a year ago.”
…“We’re much more leveraged now than we’ve been in two years, in terms of inventory throughout the whole supply chain, whether it’s traders or steel mills, or whether it’s iron ore or steel,” said Szpakowski, who previously worked in Shanghai, Hong Kong and Singapore as a commodities analyst for Citigroup and Credit Suisse Group SA. China’s steel market has gotten “too optimistic” on demand and the potential benefit of capacity cuts, including the clampdown on some scrap-based mills this year, he said.