The chief executive of Australia’s largest steelmaker, BlueScope, said a flood of exports from large Chinese steelmakers had caused steel margins to tumble by more than half, prompting a substantially lower profit forecast.

Mark Vassella said the “enormous” levels of steel being sold by Chinese steel mills into the Asian region as the domestic Chinese property market slumps is having a serious knock-on effect that will flow on to iron ore miners in Australia such as BHP and Rio Tinto.