It may still be too early to consider buying battered steel and iron ore stocks. According to Axiom analyst Gordon Johnson, the global steel market is about to take another downward turn.

Australia’s Port Hedland just set a new record for March iron ore exports at 39.5 Mmt and exports from Brazil in March came in at 29.9 Mmt. Combined, the two largest ore exporters generated 69.9 Mmt of exports last month, up 4.9 percent month-over-month and 3.6 percent year-over-year.

In addition, iron ore inventories at China’s ports were at 97.0 Mmt as of the beginning of April, up 2.3 percent week-over-week.

“From the increase in seaborne supply (& notably in the share of exports to China) + higher China port inventories, we infer evidence that the seasonal rout typically defining 1Q is over & see downward price pressure imminently ahead,” Johnson explains.

U.S. steel imports came…

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