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China Baosteel's Q3 web earnings more than halves on faltering steel rates

China's biggest noted steelmaker, Baoshan Iron & & Steel, reported on Tuesday a nearly 65% plunge in its thirdquarter net earnings, undermined by a fall in steel prices.

The business, known as Baosteel, said in a filing to the Shanghai Stock Exchange that it made net earnings of 1.34 billion yuan ($ 188 million), down from 3.8 billion yuan in the year-ago period.

Baosteel is a subsidiary of state-owned China Baowu Steel Group, the world's biggest steelmaker by output.

Net profit over the very first nine months of the year fell 29.56% from the very same duration a year before to 5.88 billion yuan, it stated.

Disappointing need for steel amidst a consistent property downturn and weaker-than-expected usage from the facilities sector had hammered steel prices in the 3rd quarter, squeezing steelmakers' profit margins, experts stated.

In the first 9 months of the year, the typical cost of imported iron ore dipped 0.8% while steel costs slid 7.67%, the state-backed China Iron and Steel Association stated last week.

Losses among Chinese steelmakers totalled 34.1 billion yuan from January to September, main information revealed on Sunday.

Need, nevertheless, revealed indications of stabilising after a raft of stimulus procedures unveiled in late September boosted belief, Baosteel said.

Baosteel produced 12.56 million metric tons of pig iron and 13.3 million tons of steel in the July-September quarter, bringing the overall in the first nine months of the year to 36.68 million tons and 39.61 million tons, respectively.

Export orders were 4.66 million loads in the first 3 quarters, it stated.

China made 768.48 million tons of crude steel in the first 9 months of this year, down 3.6% year-on-year, main data showed.

(source: Reuters)