Industrial Companies' Profits Spike in August
(Beijing) — Profits of industrial companies in China rose 19.5 percent to 534 billion yuan ($80 billion) in August, compared with a year earlier, the National Bureau of Statistics (NBS) said Tuesday.
The pace of growth is the fastest it has been this year largely because of a low base of comparison a year ago, a time of sluggish growth, stock market turmoil and a devalued yuan, said He Ping, an official with the industry department at the statistics bureau.
For the first eight months, profits of state-owned industrial firms fell 2.1 percent in the first eight months of 2016, while the earnings of privately owned companies and those backed by investors outside the mainland grew 8.4 percent and 10 percent respectively.
During the same period, overall profits in manufacturing — which is one category under industrial companies — rose 14.1 percent compared with the first eight months of 2015, fueled by strong performance from automobile makers. Profits in the automobile industry rose by 43.9 percent in August, much faster than July's gain of 24.9 percent, He said.
Profits in coal mining, which shrank in previous months plagued by overcapacity and declines in global commodity prices, rebounded in the first eight months with a growth rate of 15 percent. The industry saw a 19 percent drop in profits in the first seven months compared with a year earlier.
Coal prices in China surged in August due to controlled output caused by the nation's strategy to trim excess capacity. The Bohai-Rim Steam-Coal Price Index (BSPI), a major coal price index in China, rose 13 percent, from 436 yuan per ton on Aug. 3 to 494 yuan at the end of the same month.
Coal prices continue to jump. The latest BSPI was 554 yuan per ton on Sept. 21.
Contact reporter Coco Feng (renkefeng@caixin.com); editor Ken Howe (kennethhowe@caixin.com)
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