Baoshan Iron & Steel, the listed subsidiary of major Chinese steelmaker Baowu Group has announced that its net profit amounted to RMB 4.571 billion ($0.67 billion) in the January-June period this year, down 6.3 percent year on year.
In the given period, Baoshan Iron & Steel registered an operating revenue of RMB 160.731 billion ($23.7 billion), up 6.18 percent year on year.
In the first six months, Baoshan Iron & Steel's outputs of pig iron and crude steel amounted to 23.765 million mt and 25.537 million mt, up 0.22 percent and down 0.75 percent, respectively, while its sold 25.682 million mt of finished steel, up 1.48 percent year on year.
The company stated that relatively high raw material prices and the poor performance of steel contributed to the decline in its net profit in the given period.
Baoshan Iron & Steel stated that the global situation has been complex and tough since the beginning of this year. Trade barriers, carbon tariffs and export controls have squeezed steel exports, while domestic demand remains weak and prices have barely improved. Geopolitics and energy costs have pushed raw material prices up, keeping the industry's margins under pressure.
According to Baoshan Iron & Steel, the crackdown on involution-style competition in China will continue to deepen, while the newly implemented domestic capacity replacement regulations will further optimize the steel industry's supply structure. At the same time, the steady progress of the "Two Major (major national strategy implementation and key-area security capacity building)" and "Two New (large-scale equipment renewal and consumer goods trade-in)" initiatives, along with the construction of the "Six Networks - water, power, computing, communications, underground pipelines, and logistics" will continue to drive demand for high-quality steel products. Meanwhile, sustained strength in sectors such as automobiles, shipbuilding and high-end equipment will continue to steer the steel industry toward high-quality development.
