Crude steel production in China, the world's biggest maker of the metal, fell to a four-month low as companies shut plants for maintenance amid weakening demand from builders and automakers.

Output was 53.8 million metric tons in June, the lowest level since February, according to data from the National Bureau of Statistics. That's 4.1 percent lower than the 56.1 million tons in May, and 9 percent higher than a year ago.

China's larger steelmakers, including Wuhan Iron & Steel Group and Hebei Iron & Steel Group, are joining smaller rivals in reducing production after prices fell 17 percent from an 18 month-high on April 15. Steel prices are likely to drop 10 percent for the rest of the year because of high inventory and poor demand, JPMorgan Chase & Co. said in a July 12 note.

"National daily production has shrunk 10 percent from the peak, but it is still 12 percent to 18 percent higher than in the first quarter of 2009, the last time losses were industry- wide," Citigroup Inc. analyst Scarlett Chen wrote in a July 14 note. "Big mills will have to cut more production than small mills."

China, the biggest buyer of iron ore, will probably cut annual imports of the raw material for the first time since 1998 because of slowing demand from the steelmakers, according to Xu Xiangchun, chief analyst of Mysteel Research Institute. Iron ore imports surged 42 percent last year to 628 million tons.