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[Ferro-alloys.com]China's bloated steel industry will continue to experience tough times this year despite years of government efforts to address overcapacity in the sector, the Ministry of Industry and Information Technology (MIIT) said on Thursday.

"Overcapacity in the steel industry can hardly improve, the steelmakers' profitability is hardly positive, and the market will remain weak," the ministry said in a statement on its website.

The Chinese government has been at pains to digest production gluts from an investment boom spawned by generous subsidies in the past that saw producers in "favored" sectors, including steel, expand rapidly with little regard for real market demand.

To gradually solve the problem, a ban of new projects in steel, cement, electrolytic aluminum, flat glass and shipbuilding industries before 2017, and a gradually elimination of existing substandard projects are underway.

But the ministry said with previous construction projects still in operation, crude steel output may continue to rise in 2015.

Earlier data showed China produced 823 million tons of crude steel last year, up 0.9 percent. The China Steel Price Index stood at 83.1 at the end of December, down 16.2 percent year on year.

• [Editor:Mike.zhang]