Hunan Province-based Chinese steelmaker Hunan Valin Iron and Steel Group Co. has issued its estimated financial results for 2012, indicating a net loss in the range of RMB 3.1-3.3 billion ($494-525 million), compared to a net profit of RMB 70.14 million ($11 million) in 2011.

Valin Steel stated that in 2012 it reduced its production costs by RMB 5.7 billion ($908 million), while it also reduced its debt burden by RMB 7.7 billion ($1.2 billion) during the year. In the fourth quarter last year, Valin Steel’s net loss was down 40 percent compared to the previous quarter.

The company stated that its net loss in 2012 was due to declines in steel sales prices, high raw material costs and weak market demand, despite its efforts to improve its operating conditions.