This year China's steel industry is likely to see its worst first quarter performance since the beginning of the 21st century, said Liu Zhenjiang, vice president of the China Iron and Steel Association (CISA), as reported by netease.com.
"China's steel industry posted a poor performance in profits in January and February, worse than in the last two years. 43 percent of key steel mills monitored by the CISA suffered deficits in January with a combined loss of RMB 1 billion, hitting a record high, and the situation for February does not appear good either. The performance in the first quarter this year might be the worst ever," said Liu.
"Steel demand in January declined by 8.6 percent from a year earlier and steel output slid 3.2 percent year on year. The steel price index fell below 96 points, dropping to the lowest level in 20 years. In addition, inventories of wire rod and rebar witnessed an increase," Liu added.
An analyst also told netease.com that the outlook for China's steel industry does not appear very bright this year, saying a widening loss is likely to be seen in February and steel prices suffered continuous falls for a period of time in March.
The analyst also pointed out that prices for steel products, iron ore and coke all reached historic lows and only a limited improvement may be seen in the steel market in the second quarter and steel mills are expected to face increased difficulties due to the credit crunch.
Source: www.steelhome.cn/en, China steel information centre and industry database