China’s Steel Industry Faces Sharp Drop in Profits Amid Rising Costs and Weak Demand

The profits of China’s iron and steel enterprises fell by nearly half year-on-year in the first quarter, and the average profit margin was a mere 0.58%, according to China Iron and Steel Association (CISA).

The steel industry’s biggest problem is low margin, CISA deputy secretary general Chen Yuqian said at a press conference Tuesday.

Steelmakers’ revenue fell faster than the drop in production costs, as iron ore prices remained high, while sales declined and steel prices saw a consistent drop.