77 Chinese steel makers profit CNY 8 billion in July

According to China Iron and Steel Industry Association, some 77 major steel makers across mainland China earned a total profit of CNY 8.59 billion in July drop of 35.45%MoM. Profits of the 77 in the first seven months totalled CNY 65.21 billion.

The firms sales margin slipped 1.42%MoM to 2.75% in July. According to the National Bureau of Statistics revenue of above scale industrial enterprises grew 29.8%YoY to CNY 45.85 trillion in the first seven months.

One CISA insider said the surging import price of iron ore was the primary reason behind steel makers’ weak performance. July iron ore imports totalled 54.55 million tons and total iron ore imports in the first seven months grew 7.81%YoY to 389 million tons with an average price up 40% to USD 163 per ton.

Baoshan Iron and Steel posted a 36.82% decline in operating profits for the first half to CNY 6.76 billion. The company board attributed the declined to surged costs on fuel.

CISA data also showed that crude steel production grew 15.49%YoY to 59.3 million tonnes in July and 10.3%YoY to 410.36 million tons in the first seven months. Full year production is estimated to exceed 700 million tons.
Mr Xu Xiangchun chief consultant at mysteel.com said steel prices remained high in August. With higher costs and greater production, steel sector growth may slow down in the second half.

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