China's building materials industry is expected to rake in more profits this year, today's China Daily quoted a senior industry official as saying.

"Thanks to the central government's policies to expand demand, the country's building materials industry earned a net profit of 1. 57 billion yuan in the first ten months of the year," said Lei Qianzhi, deputy director of the State Administration of Building Materials Industry.

But, the industry suffered a loss before July, according to him.

"The industry is expected to earn 2 billion yuan in 1999," said Lei.

The industry's value-added output amounted to 65.5 billion yuan from January to October, up 11.6 percent from the same period last year.

The value-added output is expected to reach 87 billion yuan this year, up 9.5 percent from the previous year.

During the first ten months, cement output totaled 439 million tons, up 12.8 percent from a year ago. Sheet glass output amounted to 139 million crates, up 5.5 percent.

"The price for major building materials was a little bit higher than that in 1998," noted Lei, adding that the exports of building materials were on the rise.

China exported 1.84 billion US dollars worth of building materials in the first ten months of the year, up 4.5 percent from a year ago.

High value-added products such as glass fiber and marble plates continued to be major export items. These products were mainly sold in Japan, the United States and Belgium.

"Despite the progress, the overall situation of the building materials industry was not optimistic," warned Lei, who explained that the oversupply, irrational production mix and low profit still hamper the further development of the industry.

According to him, China has closed cement and glass factories with a total production capacity of 40 million tons and 15 million crates in 1999 to improve the industry structure.

It will continue to close more small glass and cement factories next year. The closure will help reduce an additional production capacity of 50 million tons of cement and 15 million crates of glass, according to Lei.

"China's possible accession to the World Trade Organization will be a great challenge to domestic firms," he added. (China Daily).