Masteel to sell some non steel assets to improve profitability

Anhui Province based Chinese steelmaker Maanshan Iron and Steel Company has announced that it plans to sell some non steel assets to its parent company Maanshan Iron and Steel Group for the purpose of optimizing asset structure, enhancing asset operating efficiency, reducing financial costs and improving profitability.
The assets to be sold are all assets relating to non-steel business including stakes held by Masteel in some non steel subsidiaries of Maanshan Iron and Steel Group as well as related assets of Masteel's affiliated non steel companies. The total net value of the assets to be sold amounts to no more than 20% of Masteel's net asset value at the end of the latest financial year.

  China Xinjiang find 187 million tonne iron ore resources

Xinjiang, province located in Northwest China, fines 187 million tonnes of iron ore in Dunde iron ore mine, 163 km outside Hejing county, with associated zinc 1.5 million tonnes and gold 50 tonnes, official website of Ministry of Land and Resourced. The mine is reportedly in the east part of Awulale mineral body of west Tianshan Mountain.

  Chinese steel giants facing toughest times in five years

China's largest iron and steel group is determined to cut output and upgrade production as it copes with the toughest market conditions since 2008. Mr Kong Ping vice president of Hebei Iron & Steel Group Co Ltd said that the iron and steel industry is in much worse shape than it was a year ago, with more excess capacity and bleaker financial conditions, he said. A high debt ratio is also a threat for State-owned Hebei Iron and Steel, because the central bank may keep liquidity tight in the short term, according to Kong. Mr Kong said that "The bottom line is to ensure our capital chain doesn't break in the short term. In order to maintain normal production, we will try any method to control costs." The iron and steel giant, which was created through the June 2008 merger of Handan Iron & Steel Co Ltd and Tangshan Iron & Steel Co Ltd, said revenue fell 7.83% in the first quarter to CNY 26.86 billion (USD 4.38 billion). Net profit slid 87.82% to CNY 43.8 million. Mr Kong said there will soon be "a new round of mergers and acquisitions in the iron and steel industry.”
Mr Kong said that iron and steel supplies far outweigh demand. The industry's capacity utilization ratio is only 72%. The global rule of thumb is that any industry with a capacity utilization ratio below 78 percent has excess capacity. Mr Ding Yue, an analyst at China International Capital Corp Ltd, said the industry's profitability in the second quarter probably worsened. Ding said losses will widen further in the third quarter, because the supply-demand gap is expanding.

  Rebar gains on higher iron ore and railroad construction outlook

Steel reinforcement-bar futures in Shanghai rose for the fourth day, buoyed by a rally in iron ore prices and the possibility of further railroad construction. Rebar for delivery in January on the Shanghai Futures Exchange rose as much as 1% to CNY 3,694 (USD 601) a metric tonne and was at CNY 3,686 at 10:41 AM local time, headed for the highest close since April 19. Futures gained for the sixth week.
Mr Wang Yongliang an analyst at Beijing CIFCO Futures Co in Tianjin said that “Rebar has established its upward trend, so news about policy induced building material demand and any possible cut in capacity due to environmental concerns will all support prices.

  Hebei Steel in H1 exported 1.954 million tonnes of steel products

Under the context of lackluster domestic steel market and more hurdles in exports, the international trade company of Hebei Steel created an upturn for steel exports. In the first half of 2013, they signed 2.187 million tonnes exports orders and actually exported 1.954 million tonnes. Breaking into subsidies, Tangshan Steel finished 113 percent of its target, up 54.65% year on year; Handan Steel completed 109 percent of its goal, increasing 34.52% from the prior and Chengde Steel achieved 148 percent of its task, hiking 1043% from a year earlier. Breaking into products, CR series steel products hit 1.0792 million tonnes, winning a 52% year over year growth and HRC exports realized an 338% year on year gaining

  Loss forecasted for H1 for many Chinese steel giants

Only seven out of 17 listed steel mills that unveiled interim earnings projections expect increased profits for the first half of the year, indicating a challenging outlook for the sector. 17 steel companies had released their forecast for preliminary earnings. The Securities News Journal reported that three expected a drop in profits, six anticipated extended losses and seven companies predicted increased profits. Angang Steel, the listed arm of Anshan Iron and Steel Group Corp, expected a CNY 702 million profit from January to June. This contrasted sharply with a CNY 1.98 billion loss booked in the same period last year. But insiders said the profit was because of an asset swap with its parent group and a readjustment of the depreciation period for fixed assets. In other words, the core business was not responsible for the profit. The industrial slowdown forced many steelmakers to sell assets. In 2012, Baoshan Iron and Steel sold its stainless steel sector to parent Baosteel Group, leading to a surge in its net profits.

  Shougang expects net loss in range of CNY 250 to CNY 300 million for H1

Beijing based Chinese steel producer Shougang Group has announced an estimated net loss in the range of CNY 250-300 million (USD 40.78 to USD 48.94 million) for the first half of the current year, compared to a net loss of CNY 349.43 million (USD 57 million) in the corresponding period last year.
Despite adjusting its product structure and reducing its costs, Shougang Group recorded a loss for the given period amid the ongoing sluggishness in the Chinese steel sector.

  Sichuan to eliminate steelmaking capacity of 320000 tonnes

BChina steel industry is beset by overcapacity and backward productivity and it has yet to see fresh signal for recovery, said an employee from Pangang Group. Sichuan province announced to wash out 320,000 tonnes of steelmaking capacity. Technology innovation, energy saving& emission reduction and depollution becomes the keynote of China steel industry.