BEIJING - China's steel output grew by 9.6 percent year-on-year in the first half to 350 milliontons, but its sales-profit ratio dropped to 2.42 percent, the lowest in years, the Ministry ofIndustry and Information Technology (MIIT) said Tuesday.
The ministry said on its website that the soaring price of iron ore was the main reason for theweaker profitability.
Chinese steel producers' average sales-profit ratio stood at 7.26 in 2007. Since then, the figurebegan to slip.
The transformation and upgrading of the industry are urgently needed to enhance steelproducers' competitiveness, MIIT said.
In the first half of this year, China imported 334 million tons of iron ore, 8.1 percent more thatthe same period last year, with the average price up by 42.4 percent year-on-year to $161 perton.
MIIT predicted steel output will hit a new record high of 690 million to 700 million tons in 2011.
"The whole industry will maintain high output but low profit for quite a long time," MIIT said.
