According to the preliminary data issued by the China Iron and Steel Association (CISA), in 2010 the aggregate net profit registered by the Chinese steel industry was RMB 85 billion ($12.8 billion). Subtracting revenues from investments in non-steel businesses by Chinese steel enterprises, the aggregate net profit from primary steel businesses was only RMB 75 billion ($11.3 billion), with a profit margin of 3.5 percent.
Based on the data provided by China's Ministry of Industry and Information Technology (MIIT), in 2010 the country's total crude steel production was 685 million mt, with a capacity utilization rate as high as 89 percent. This means that the overcapacity issue still exists in China's steel industry.
Some analysts predict that Chinese steel production capacity will increase by five to sis percent year on year in 2011, resulting in increased consumption of iron ore.