China’s large and midsize steelmakers completed only 7.81% of their annual investment plan in the first half 2013 according to the China Iron and Steel Association (CISA). Small-sized companies finished 31.53% of their respective plans.

The steel industry made RMB 303.5bn ($4.97bn) of fixed assets investment in the first half 2013, up 4.26% from a year earlier. This was low compared to the national investment rate for all businesses of 20.1% and a 17.1% growth rate for the manufacturing sector.

China’s 86 major steelmakers earned about RMB 2.27bn ($3.72M) profits in the first half this year, with the profit margin standing at only 0.13%, almost the lowest among the country’s industrial sectors.

Profits of steel mills in China declined month by month in the first half of this year, CISA said.

Some 35 out of the 86 large and midsize steelmakers incurred losses in the period, representing 40.7% of the total which was 3.5% higher than that in the same period last year.

In June, these 86 major steelmakers together incurred a loss of RMB 699M ($11.45M).

Total borrowings from banks by large and midsize steelmakers increased by RMB 105.156bn ($1723M), or 8.8% from a year earlier in the six months ending on June 30, said CISA.

At the end of 2012, China’s large and midsize steelmakers had a combined debt ratio of 68.3%, with their total debts at RMB 2.83 trillion ($4.63bn), which was seven times greater than that at the end of 2001.

Source: China Metals e-mail