Shanghai steel futures fell 2 percent on Wednesday, under pressure from concern that a weak

property sector in China may curb demand for the building material through next year.

China’s cooling property market helped pull the economy to its slowest growth since the global financial crisis in the third quarter, just 7.3 percent from a year before. Some

analysts say there is chance the government could miss its full-year target of 7.5 percent.

“The real estate industry is a major risk to China’s economy and investment in the sector has been slowing down in the past six months and this will continue in the next six months or

more,” said Cao Bo, an analyst at Jinrui Futures in Shenzhen.

“This is why rebar prices are falling.”

The most traded rebar for delivery in May 2015 on the Shanghai Futures Exchange was down 51 yuan at 2,559 yuan ($418) a tonne by midday. The most active contract touched a record low of 2,460 yuan earlier this month.

Rebar, used in construction, has lost 30 percent of its value this year.

The real estate sector accounts for around 20 percent of steel demand in China, the world’s top consumer and producer of the alloy.

Cao said he saw support for rebar at around 2,400 yuan if iron ore stayed at $80 a tonne.

The weakness in steel piles more pressure on iron ore as Chinese steel mills keep stockpiles of the steelmaking raw material in check while global supplies remain high, traders

said.

Iron ore for immediate delivery to China rose 0.4 percent to $81.50 a tonne on Tuesday, according to data compiled by The Steel Index.

It fell to a five-year low of $77.50 at the end of September, hit hard by abundant supply as low-cost top miners such as Rio Tinto and BHP Billiton expanded output in the face of weak demand in China.

BHP Billiton said it was on track to meet its full-year iron ore production guidance after mining a record 62 million tonnes in the September quarter at its Australian operations, 15

percent more than a year before.

Weaker Chinese steel prices may halt the recent recovery in iron ore, according to an iron ore trader in Shanghai.

“We’ve sold all three cargoes we have and right now we’re just on a ‘wait and see’. We’re playing it safe because you can’t go too aggressive at this point,” he said.

At the Dalian Commodity Exchange, the most active January iron ore contract was off 0.4 percent at 577 yuan a tonne. The next most traded contract, for May delivery, fell 1.8 percent to 538 yuan per tonne.