China’s steel industry still faces great trouble despite an upturn in major steel mills’ profit in May and many mills were still in red, according to data from the China Iron and Steel Association (CISA).<br /> <br /> A total of 26 out of 88 medium and large-sized iron and steel enterprises suffered losses, with the combined loss of 8.93 billion yuan in the first five months of this year, showed the CISA data.<br /> <br /> Over January-May this year, the sales revenue of the 88 steel producers hit 1.5 trillion yuan, a slight growth of 0.95% year on year. Their profits totaled 1.75 billion yuan, a decrease of 46.55% from the same period last year, while the profits in May surged 132.4% from April to 2.85 billion yuan.<br /> <br /> Among the plants with an annual production capacity of 5 million tonnes, 18 witnessed a decline in sales income, and 9 reported losses.<br /> <br /> "The steel industry has entered into a period of big adjustment," said Chi Jingdong, vice secretary-general of the CISA.<br /> <br /> According to Chi, the iron and steel demand in China will remain sluggish for a long period, because the demand from infrastructure, housing construction and automobiles is not strong.<br /> <br /> Meanwhile, with the steel industry struggling with a supply glut, the steel price will remain low for quite a long period, resulting in losses for the industry. Tighter credit would also constrain steel mills’ cash flows.<br /> <br /> <p> Chi warned that "the industry has not entered the worst period," and it could face more challenges as the nation adjusts its economic structure. </p> <p style="text-align:center;"> <img src="/upfiles/news/image/20140711/20140711173909_5272.jpg" alt="" /> </p>