The increase in the indicator was facilitated by the improvement in demand for steel and a low base of comparison

China’s steel industry increased its net profit by 157.3% in 2023 compared to 2022, to RMB 56.5 billion ($7.95 billion). This is reported by Kallanish with reference to the Chinese National Bureau of Statistics (NBS).

According to NBS, the growth was driven by improved steel demand and a low base from the previous year. More than half of the profits in 2023 were made in November-December.

Annual profit in the mining industry last year increased by 6.7% year-on-year – to 55.45 billion yuan.

However, annual profit growth rates in both industries may be overstated. If we calculate the indicator based on previously published data for 2022, its growth in the steel industry was only 54.5% y/y, and in the mining sector, profits fell by 6.8% y/y.

In general, according to NBS, the total gross profit of China’s large industrial enterprises amounted to 7.69 trillion yuan ($1.07 trillion) in 2023, down 2.3% from 2022.

As GMK Center reported earlier, China’s steelmaking companies produced 1.019 billion tons of steel in 2023, up 0.6% from 2022. Thus, the downward trend in the country’s steel industry has stopped after two consecutive years of declining production. The period that contributed to the increase in steel production in 2023 was January-July, as the last 5 months of the year saw a month-on-month decline in volumes.

Also, China increased its exports of steel products by 36.2% in 2023 compared to 2022, to 90.3 million tons. Export shipments reached their highest level since 2016.