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Profit of China's Steel Industry Hits Historical High
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China's iron and steel industry reaped record profit of 169.95 billion yuan (US$22 billion) in 2006, rocketing more than 30 percent year on year, figures from the China Iron and Steel Industry Association show.

The whole industry scored 279.5 billion yuan in pre-tax profit in 2006, an increase of 23.95 percent over the previous year.

Stimulated by robust market demand, China produced 418.78 million tons of crude steel in 2006, up 18.48 percent year on year and accounting for 33.79 percent of the total global production.

The country also produced 404.17 million tons of pig iron last year, up 19.78 percent and accounting for 46.6 percent of the total in the world.

Directed by the government's macro control policy, the development of China's iron and steel industry is now in good shape, said Luo Bingsheng, vice president of the China Iron and Steel Industry Association.

The Chinese government once adopted strict measures in 2004, including closing some local steel mills, to curb the surging investment in the industry.

Steel price hike, a product of the country's decade-long economic boom, has lured astronomical funds into the industry. Most of the country's steel giants now are state-owned enterprises.

"The scale of investment is still too large in the industry," Luo said.

(Xinhua News Agency February 27, 2007)

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