Angang Steel Co., China's second-largest steel maker, said third-quarter profit climbed 29 percent as it benefited from higher steel prices.

Net income rose to 2.27 billion yuan (US$332 million) from 1.76 billion yuan a year earlier, the Anshan, Liaoning Province-based company said yesterday in a statement to the Shenzhen Stock Exchange, citing domestic accounting standards. Sales rose to 22.8 billion yuan from 16.3 billion yuan.

China's steel prices gained 23 percent this year to a record on June 5, helping mills cover record costs for iron ore and coking coal. Chinese mills may take losses in the fourth quarter as the global credit crunch and economic slowdown curbs demand from builders and car makers, sending steel prices lower.

Angang fell 4.6 percent to HK$3.56 (46 US cents) in Hong Kong yesterday. The stock has fallen 83 percent this year, compared with the 51-percent drop in the Hang Seng Index. The announcement came after the market closed.

Angang's nine-month profit rose 26 percent to 8.25 billion yuan, the statement said. Sales rose to 63 billion yuan from 49 billion yuan.

China's prices of hot-rolled coil, an industry benchmark, have fallen to 3,620 yuan a ton from a record 5,957 yuan on June 5, according to Beijing Antaike Information Development Co.. The slump has led to losses at almost all steel makers, JPMorgan Chase & Co.'s analyst Zhang Feng said in a note last week obtained by Bloomberg News.

Angang started its new mill in Bayuquan, Liaoning on September 6 to make as much as 5 million tons of products a year.

(Shanghai Daily October 24, 2008)