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China's Steel Sector Witnesses Reverse of Decline
China's steel sector has reversed its profit decline, a senior industrial official said Wednesday in Beijing.
According to statistics from the State Administration of Metallurgical Industry, the steel sector reported a profit of 5.4 billion yuan (US$654.2 million) during the first half of the year, up 350 per cent from the same period last year.
The proportion of those large and medium-sized steel enterprises that are losing money decreased to 24.7 per cent from a high of more than 40 per cent, statistics indicated.
"The robust profit was hard won because of a glut on the domestic steel market," said Pu Haiqing, director of the administration, the industry's watchdog.
Pu attributed the favourable conditions to the sector's strenuous efforts in output control.
The average price on the domestic steel market increased by 87 yuan (US$10.4) per ton during the first six months of the year, the statistics said.
In June, the price of low-grade steel surged by 340 yuan (US$40.9) per ton, compared with prices at the beginning of this year.
Total steel output amounted to 61.2 million tons, an increase of 3.4 per cent over the same period last year. But the increase rate was 4.9 percentage points lower than the average figure in 1999.
The country's steel conglomerates, including Shanghai-based Baoshan Iron and Steel Corp, Anshan Iron and Steel (Group) Co Ltd in Northeast China's Liaoning Province, the Capital Iron and Steel Corp in Beijing and the Wuhan Iron and Steel Corp in Central China's Hubei Province, took the lead to control output.
Forty-six key steel enterprises, each with an annual production capacity of more than 500,000 tons, produced approximately 53.1 million tons of steel during the first half of the year, the administration said.
Small and medium-sized steel enterprises also reduced their output to 8.7 million tons, a decrease of 7.6 per cent compared to the same period of the previous year.
Sixteen provinces, municipalities and autonomous regions succeeded in achieving their targets of steel output control during the first six months.
The sector organized two strict inspections and 35 seminars across the country to ensure output control during the period.
The sector aims for a 10 per cent decrease in steep output and a total profit of 10 billion yuan (US$1.2 billion) this year.
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