Reuters quoted the chairman of the China Iron and Steel Association said China total apparent crude steel consumption is expected to rise about 4% to 700 million tonnes this year.

Mr Zhu Jimin also head of Shougang Group one of the country biggest steelmakers said prospects for the steel sector remained gloomy with the entire sector facing falling profits in 2012.

He said "Enterprises are facing increasing operating risks, under pressure from a variety of factors such as rising costs, falling demand and difficult and expensive financing."

Mr Zhu said a series of policies introduced last year to control the real estate sector had reduced demand for steel, and if the policies were not adjusted the situation could worsen in 2012.

He said slowing growth in domestic manufacturing, railway, shipbuilding and auto sectors could also take its toll.

According to official data from the National Bureau of Statistics total crude steel output stood at 630.98 million tonnes in the first eleven months of 2011 up by 9.8%YoY.

However production slowed considerably in the final quarter of the year with daily runs slipping to 1.66 million tonnes from about 1.9 million tonnes from February to September.

(Sourced from Reuters)