Iron companies disclosed a total net profit of 9.98 billion yuan ($1.54 billion) in interim reports released by 27 steel enterprises listed on Shanghai and Shenzhen stock exchanges on Aug 29. The net profit belongs to the parent companies and is down 15.7 percent compared with the same period last year, according to WIND Info, the Economic Information Daily reported Tuesday.
The decline in net profits was due to the rising prices of iron ore and energy, the report said.
Guangzhou Iron & Steel, Angang Steel Co Ltd, Maanshan Iron & Steel, Liuzhou Iron & Steel Co Ltd, Laiwu Steel Corp and Bengang Steel Plates Co saw significant decreases in the first half. Their net profits slid 362.7 percent, 92 percent, 70.2 percent, 39.6 percent, 27.1 percent and 13.5 percent respectively.
BHP Billiton Ltd, the world's biggest miner, released a report for the fiscal year of 2010 to 2011 announcing a net profit of $23.65 billion. The profit was achievable due to the rising price of iron ore. In the first half of this year, the corporation's net profits totaled $13.12 billion, the report said.
"A big part of the profits of these steel enterprises do not come from their iron and steel business. In fact, their main business is not in an optimistic situation," a source from China Iron and Steel Association told the newspaper.
Decreased profits in the iron industry have also affected the performance of iron and steel stocks. The market value of seven listed iron companies fell below their market value, the report said.