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Chinese Steel Industry Reported Massive Losses

Economic Information Daily, a branch of Xinhua, recently reported, based on information that reliable sources from the China Iron and Steel Industry Association (CISA) provided, that large and mid-sized Chinese steel companies saw a month-over-month profit decline of 25 percent in October. From January to October, the loss in primary steel business totaled RMB 72 billion yuan (around US$11 billion). Around 47.5 percent of the steel companies reported losses. The total loss from January to September was only RMB 28 billion. Most of the publicly traded steel companies have already predicted a difficult next year. Analysts suggested that the primary causes of a landslide of the steel industry are major market declines seen in the housing, the railway, the car and the shipbuilding industries. Studies also showed that, by the year 2018, the Chinese steel industry will be able to produce 1.2 billion tons of steel. By then, China will be able to consume 0.7 billion tons while exporting 0.1 billion tons. Many industry experts called for a major industry-wide structural adjustment. 
Source: Economic Information Daily, December 4, 2015
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