Lead indicators of Chinese demand for steel continue to worsen. Weak real estate data as well as contagion fears on account of debt defaults in the high-yield developer market, sets a context for the current steel production cuts. Risk-reward in steel equities is further worsened by the precipitous fall in iron ore prices. The last cost support for steel is in elevated coking coal prices and it appears that it is only a matter of time, given the current pace of Chinese steel production decline, that coking coal starts to correct.