China's biggest listed steelmaker Baoshan Iron & Steel Co Ltd will slash the prices of its main products for September bookings by up to 3.4 percent, the third reduction in a row since June, indicating a lack of market confidence in the short run.

The Shanghai-based manufacturer will cut hot-rolled coil prices by 100 yuan ($15.7) per ton and cold-rolled coil prices by 150 yuan per ton. It will cut most of the prices by 80 to 180 yuan, according to a price adjustment notice published by the company on Friday.

Accumulated cuts have amounted to up to 12.5 percent compared with quotes in June.

The company's prices are widely seen as a barometer of the steel industry. Prices have been weakening due to the sluggish construction market in China and a general lack of strength in the global economy.

The July-August summer period usually sees a seasonal bottoming out, but the failure of prices to pick-up in September suggests ongoing tepid demand due to lack of infrastructure projects, said Heng Kun, principal analyst with Essence Securities Co Ltd.

"The steel market might stabilize in the coming two months, but as demand remains weak, prices will not soar any time soon," Heng told China Daily.

And there is less likelihood that the central government will place more money into large-scale construction projects in the second half of 2012, which is in line with the priority of developing emerging industries, he said. "A rebound of actual GDP growth may come earlier than a recovery of corporate earnings."

Steel industry outlook gloomy: