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Baosteel's first-quarter profit falls 8.6% due to Iran war, which increases costs and weakens demand.

?Baoshan Iron & Steel Co, China's largest?listed steelmaker reported a 8.6% annual drop in its first-quarter net profit? on Wednesday.?Hit by higher costs relating to?feedstocks and sluggish domestic demand.

In a filing with the Shanghai Stock Exchange, the company known as Baosteel said that it had earned approximately 2.23 billion Yuan ($326.33 millions) in the first three months of 2026. This is down from 2.43 million Yuan in the same period last year.

Steel prices fell 4.4% while iron ore rose 3.2% in the first three months of this year, reducing margins, according to Baosteel. Baosteel is a state-owned subsidiary of China Baowu Steel Group.

Iron ore costs remained high due to higher freight charges and input costs resulting from the Iran War, which caused an increase in energy prices.

China's steel consumption continued to decline due to the prolonged property market slump, dropping 4.4% between January and March.

Baosteel's 2025 net profit increased by 40.53%, to 10.3 billion Yuan. This was due to lower raw material costs and robust steel exports.

In the first quarter of this year, the company produced 12,23 million metric tons of iron and 13,21 million tonnes of steel.

In 2026, the country aims to produce 48.54 million tons of iron, and 51.51 millions tons of steel.

Baosteel has received 1,96 million tons of orders from overseas for steel products during the?quarter, up from 1,555?million tonnes in the same period in 2025.

Steel exports by the company increased 6.8% on an annual basis to 6.48 millions tons. (1 dollar = 6.8335 Chinese Yuan) (Reporting and editing by Tomasz Janovowski and Joe Bavier).

(source: Reuters)