Among the listed steel companies expecting profits, the most watched by the market is undoubtedly last year's industry "loss king" *ST Ansteel. On January 22, the company released its 2013 performance forecast, stating that it expects to achieve a net profit attributable to shareholders of the listed company of 770 million yuan in 2013. Previously, the company had huge losses of 2.146 billion yuan and 4.157 billion yuan in 2011 and 2012, respectively. Regarding the turnaround to profit in 2013, although there are doubts in the market that a considerable part of *ST Ansteel's profit came from accounting adjustments, the company has at least avoided the fate of "suspension of listing due to three consecutive years of losses."

　　However, in recent years, the steel industry has shown a trend of "the 'loss king' takes turns, this year it's my turn." In 2010, Hunan Valin Steel became the industry's "loss king" with a loss of 2.64 billion yuan; in 2011 and 2012, the title went to *ST Ansteel. And just as *ST Ansteel turned losses into profits in 2013, another listed steel company suddenly reported a huge loss.

　　Yesterday evening, Chongqing Iron & Steel released its latest announcement, stating that after preliminary calculations by the finance department, it expects a loss in its 2013 annual operating performance, with a net profit attributable to shareholders of the listed company of approximately -2.5 billion yuan. Regarding the reasons for the significant loss, Chongqing Iron & Steel stated that it was mainly due to continued sluggish demand in the steel market, a sharp decline in steel prices, and the product structure adjustment not yet in place, resulting in high production costs. At the same time, the environmental relocation also imposed a heavy financial burden on the company.

　　At the same time, although the listed steel companies currently appear to be improving, overall, the steel industry's prosperity remains quite low. The latest statistics from the China Iron and Steel Association show that in November 2013, 20 key large and medium-sized steel enterprises across the country suffered losses, an increase of 2 compared with the same period in October, with the loss ratio reaching 23.26%, expanding by 2.33 percentage points month-on-month. The loss amount for the month was 1.141 billion yuan, an increase of 1.60% month-on-month.

　　In this regard, Zhang Changfu, vice chairman and secretary-general of the China Iron and Steel Association, also publicly stated recently that producers, traders, and all aspects of the steel industry chain must be prepared to endure prolonged hardship and tight budgets. He pointed out that the three fundamental factors affecting and constraining the development of the steel industry have not fundamentally changed: first, the work to resolve overcapacity has just begun, and results have not yet appeared; second, the long-term imbalance between supply and demand has led to low steel prices, which is difficult to solve in the short term; and finally, the cost of steel production remains high, and recently, steel companies have generally felt a tightening of funds.

　　"These difficulties and bottlenecks have accumulated over nearly 30 years of extensive development and will definitely not be resolved in three to five years," Zhang Changfu said.