China's steel industry faces tough decisions on iron ore supply and production levels

摘要

DUE to the fact that most iron ore stocks bought at lower prices last year have been used and the profit margin of the steel industry is not so satisfying as before, most Chinese companies have taken action to reduce output or are thinking of doing so to reduce losses brought about by jumps in production costs especially iron ore and coke. But still they have little profit to make. Based on statistics from the China Iron & Steel Association (CISA), the 77 large and medium steel groups in China from January to April reported a profit of RMB33.9bn (4.96bn dollars) which was far better than the loss of RMB4.1bn (600M dollars) year-on-year, but the growth in profit stayed at 3.6%, which is much lower than the average industrial level in China.