China’s steel output fell more than 10% in August from a year earlier amid falling prices and a sharp drop in demand for its products.

The world’s largest steel sector experienced a bleak month last month, with China Baowu Steel Group, the world’s largest supplier of the commodity, warning of worsening conditions. With mills losing huge amounts of steel per tonne they produce, many have been forced to shut down furnaces to reduce production.

China’s crude steel output fell 10.4% year-on-year last month to 77.9 million tonnes, the lowest August output since 2017, according to the National Bureau of Statistics. The drop adds to the overall decline in steel output this year, with volumes for the first eight months of the year down 3.3% to 691.4 million tonnes.

China’s steel demand has been falling as a result of more than two decades of high growth driven by the country’s rapid urbanization and industrial expansion. The situation has worsened this year, especially during the summer, as construction activity has remained stagnant. However, there have been some positive signs in September, with some steel prices rising and iron ore futures recovering from a low of below $90 a tonne, posting weekly gains.