Mainland listed steel companies have seen their net profits jump 179 percent in the first three quarters of this year. The question then is, is that surge a sign of a recovery in the sector or merely a short term buzz?

China's listed steelmakers have been booking handsome profits in the first three quarters of 2016. That's thanks to strong revenue growth in the higher end of the market.

"Manufacturing and autos are seeing healthy growth this year, which creates a cozy environment for high-end steel products. A recovery in the property sector also helped the steel sector," said Li Xinchuang, Vice-Sec. Gen., China Steel Industry Association.

China will hopefully achieve its annual steel and coal capacity reduction goals ahead of schedule this year because local authorities have intensified efforts in recent months due to pressure from the central government.

"We will definitely meet the target for capacity cuts in the steel sector. But in 2017 and 2018, low-end steel manufacturing will be mostly eliminated. There are still overcapacity issues with advanced and more efficient steel producers. That would be the challenging part of our job," Li said.

Tangshan is a major steel producing city in north China's Hebei Province and it has cut 31.9 million tons of capacity during the past four years.

China had pledged to trim it's steel overcapacity over the next few years. But a rebound in steel prices and lowered emissions from steel plants could remove the country’s incentive to crack down on its steel producers.

The World Steel Association said in October that China was still producing more crude steel than the rest of the world combined in September. That was up 3.9% from the levels of a year earlier.

"We didn't expect a growth in iron ore imports to China this year from 2015. That's mainly due to cost concerns as imported iron ores are cheaper," Li said.

Steel prices in China have remained resilient but there are concerns that a correction in prices is looming.

"China's steel consumption is on a downward track, and we need to stay calm and rational about the current price volatility in commodities," Li Xinchuang said.