(Yicai Global) Dec. 27 -- China's industrial profits shrank in the January to November period, as Covid-19 and weak demand weighed on production.

Profits at industrial firms with at least CNY20 million (USD2.9 million) in annual turnover fell 3.6 percent from a year ago to CNY7.7 trillion (USD1.1 trillion) in the 11 months ended Nov. 30, widening from a 3 percent decline over the first 10 months, according to data the National Bureau of Statistics released today.

Among businesses, steelmakers’ and oil refiners’ profits contracted at the fastest pace, while earnings at the two major vaccine makers also fell significantly.

But if those firms are factored out, profits at industrial companies jumped 6.6 percent in the period, said Zhu Hong, senior statistician at the NBS's industrial statistics department.

Equipment manufacturing, a core industry, saw profits climb 3.3 percent, up from 3.2 percent in the first 10 months, Zhu said, with its share of total industrial earnings swelling to more than 33 percent.

Profits increased at a total of 20 out of 41 major industries, an increase on 19 in the first 10 months, the figures showed.

Any pickup in industrial profits has become more challenging because the recovery in domestic demand is slow, exports are declining, corporate profit margins remain narrow, and the willingness of businesses to invest and replenish inventory has softened, according to Wu Chaoming, vice president of the Caixin Research Institute.

Government policies to stabilize the economy will support industrial profits to a degree, Wu said. But the increasing risk of a global recession is expected to further depress prices of world commodities and Chinese products, thereby weighing on profits, he added.

Revenues at industrial firms jumped 6.7 percent to CNY123.96 trillion (USD17.8 trillion) in the 11 months.

Editors: Dou Shicong, Martin Kadiev