Chinese steel companies are facing profit losses nearing 100% since the beginning of the year, forcing many companies to downsize or reevaluate their products. (File photo/Xinhua)

China's 80 top medium and large steel companies reported their total losses at 1.98 billion yuan (US$312 million) for July, reports the Shanghai-based First Financial Daily.

The 80 companies only made a profit from March to May, reporting a profit of 710 million yuan (US$112 million) over the past seven months, down 98.9% from a year earlier. 30 steel companies among them suffered from losses totaling 1.7 billion yuan (US$268 million) during the same period.

The deterioration in China's steel industry was expected amid signs of drastically falling steel prices during the rest of the year, said Hu Yanping, an analyst from Chinese Zhonglian Steel Industry Co.

The price of steel has been falling since April and the trend is speeding up, said Hu. The price of major types of steel products has been down more than 20% as of August, the lowest level since 2010, added Hu.

Lei Yu, an analyst with steel industry website lgmi.com, said that the Chinese steel industry still needs to face the problem of tightened capital for property developers, and tight regulations on loan payments to banks.

Steel companies reportedly have had to resort to directly selling or marketing their own products to downstream users due to weak orders. The move has put pressure on domestic steel traders, which have been pushed to reassess their trade portfolio or downsize operations, said Lei.