Bloomberg reported that Baoshan Iron & Steel Co China biggest publicly traded steelmaker may post its first quarterly loss since the 2008 global financial crisis as demand slows and high prices of raw materials erode margins.

According to figures derived from the company projected nine month profit, Baoshan Steel may have a loss of CNY 2.2 billion to CNY 2.9 billion in the three months ending September 30th.

The last time the Shanghai based mill posted a loss was for the October quarter of 2008.

Mr Luo Wei a Shanghai based analyst with China International Capital Corp said “China GDP is likely to trough in the second half, forcing steelmakers to post the worst result of the year in the third quarter. Fourth-quarter earnings may rebound after iron ore prices fall.”

Baoshan Steel supplier of half the domestic market for auto sheets rose 0.6% to close at CNY 6.32 today in Shanghai more than the 0.3% gain in the benchmark Shanghai Composite Index. The stock has fallen 35 percent this year. The statement came after the market closed.

It said without giving details that the company faces a double squeeze as demand from makers of auto, appliance and machinery slows and iron ore prices stay high, Baoshan Steel said in the statement. The company plans annual maintenance for major production lines.

The company said in its interim report H1 profit surged 12 fold to CNY 8.1 billion or CNY 0.46 a share from CNY 669 million or CNY 0.04 a year ago. A Bloomberg survey of eight analysts forecast a mean earnings a share of CNY 0.408.
(Sourced from Bloomberg)