China’s industrial profit growth tumbles as raw material prices fall

Profits at China’s industrial firms grew at a much slower pace in November, the statistics bureau said on Monday, pressured by tumbling prices of some raw materials, a faltering property market and weaker consumer demand.

Profits rose 9 per cent on-year in November to 805.96 billion yuan ($126.54 billion), well off the 24.6 per cent gain reported in October.

For the January-November period, industrial firms’ profits rose 38 per cent year-on-year to 7.98 trillion yuan, slower than the 42.2 per cent rise in the first 10 months of 2021, the statistics bureau said.

Zhu Hong, senior statistician at NBS, said while state efforts to cool soaring wholesale prices in November took cost pressures off downstream industries, the curbs meant the contribution from the mining and raw material sectors to overall profit growth weakened.

“But companies still face great cost pressures, and the improvement in profits for downstream sector needs to be further consolidated,” Zhu said in a statement accompanying the data release.