Anshan Steel’s listed unit reported a net loss of 1.89 billion yuan ($299 million) for the first quarter of 2012, less than in the previous quarter.
“Stocks of high-priced raw material have been a burden to Anshan, after iron ore prices slumped in the third quarter of 2011,” a source at the company said.
“As we gradually roll down the high-priced stocks, we’ll turn around in the second quarter,” the source added.
The mill’s net loss in the fourth quarter last year was 2.39 billion yuan.
“Steel demand could step up further in the coming quarters, though upward room is limited,” the source said.
Anshan pushed up its hot rolled coil and plate prices by 30-50 yuan and 30 yuan per tonne respectively for May, but the steel market remains downbeat.
China’s daily crude steel output in the second ten days of April eased to 2.005 million tonnes, down by 1.26% from the average of the previous ten days, according to China Iron & Steel Assn data released on Thursday April 26.
Market participants said China’s steel production slowed in the middle of April as some mills scaled back production on lower prices.