Steel mill owners in parts of China are in a bad mood, since steel inventories are slowly piling up in the warehouses of the country’s biggest steelmaking hub, the north-eastern city of Tangshan, as well as in the provinces of Jiangsu and Shandong.

Demand for steel is falling amid pandemic lockdowns and crippled construction activity. A lot of steel — a key raw material in the manufacturing powerhouse — is sitting idle around the country amid a stop-and-start economy which is forcing down demand and prices.

Prices of both steel and its main ingredient iron ore were volatile during the Shanghai lockdown but headed on a downward trajectory earlier this month.

Weak demand for steel, a bellwether of China’s economy, also reflected the country’s broader slowdown, though recent data pointed to some improvement as industrial production rose slightly by 0.7% in May from a year ago.