China's Iron and Steel Industry Is on Red Alert

Reportedly, China's iron and steel industry is on red alert. Profits have plunged by over capacity and fierce competition, moreover, the level of pollution is severely rising. According to China Iron and Steel Association that nearly half of its 86 members are suffering loss and their average profit margin stands at only 0.13%. The overall volume of crude steel production has surged over the past few years. Hebei Xin Gang Iron & Steel Group for example, has increased its production volume by almost 80% last year, in spite of the country's total crude steel output capacity that reached 90 million tons by the end of 2011. The pollution problem is also striking. According to the investigation of the Ministry of Environmental Protection last year in March that around 60% of the iron and steel companies in Hebei Province have environmental concerns 70% among them had anti-dust equipment idled, and 80% were found guilty of illegally dumping waste water. China's iron and steel industry has increased its capacity by 30 million tons since 2005. However, only 20% of the new equipment built since then has been inspected and approved.