According to a press release by the China Iron and Steel Association (CISA), though steel output and inventory levels in China decreased in the January-October period this year, Chinese steelmakers’ profitability declined in the given period due to high raw material prices.
As stated by the CISA, in the January-October period of the current year, China’s crude steel output amounted to 829.22 million mt, up 7.4 percent year on year, 1.0 percentage point lower than that recorded in the January-September period. Import iron ore prices had decreased to $84.04/mt as of the end of October due to increased supply and the slowdown in demand, but still remained at quite high levels.
Against this background, steelmakers’ profitability has decreased. In the first ten months of the year, CISA members’ sales revenues amounted to RMB 3.54 trillion ($503.37 billion), up 11.0 percent year on year, while they recorded an aggregate gross profit of RMB 158.8 billion ($22.58 billion), down 34.1 percent year on year, the CISA stated.