China's major steel producers saw huge losses in the first three quarters of the year as market demands continued to shrink amid a slowing broader economy.
Aggregate losses from their main business amounted to 55.27 billion yuan (8.7 billion U.S. dollars) in the Jan.-Sept. period, up from 21.68 billion yuan of losses registered in the first half of 2015, data from the China Iron and Steel Association (CISA) showed.
Zhu Jimin, vice president of the CISA, attributed the lackluster performance to falling steel demand. "The economic slowdown led to marked consumption declines in rolled steel," he said.
China's crude steel consumption has been on a losing streak since the start of the year. In the first nine months, consumption dropped 5.82 percent year on year, data showed.
After years of blind expansion, the steel industry has reached a saturated level with production capacity much higher than market demand. The regulators have asked enterprises to eliminate overcapacity but the work has yet to be completed.
Zhu said the sector should intensify the effort to slash production given the gloomy economic climate and advised the enterprises to build up their own brands and improve competence.
In the first nine months, China's major steel enterprises posted combined sales of 2.24 trillion yuan, down 19.26 percent from a year ago, data from CISA showed.
China's economic growth slowed to 6.9 percent in the first three quarters, down from 7 percent in the first half.
