China's steelmakers reel from a gloomy market as demands turn lackluster and steel prices plummet.

The China Iron and Steel Association said 77 large steelmakers across the country generated combined profits of 7.9 billion yuan ($1.24 billion) in September, a drop of 6.6 percent month on month. Their profit-to-sales ratio averaged at 2.53 percent, down from 3.08 percent in the first seven months of this year.

The September figure brought their profits for the first nine months to 82.34 billion yuan ($12.97 billion), rising 27.74 percent from a year earlier.

"Many companies have been slashing steel prices to lure buyers as demand from the real estate, automobile and appliance sectors withers," said Xu Xiangchun, an analyst at Mysteel.com, a steel information service company based in Shanghai.

Liaoning Province-based Ansteel, for instance, has recently announced it will lower delivery prices for most products by 100-300 yuan ($16-$47) per ton.

"The industry will continue to face chilly headwinds in coming months as the export outlook worsens, though affordable house construction would generate some demands and offset the downturn." said Zhang Yongkai, an analyst with 315.com.cn, a Chinese commodities trading site.