The booming Chinese economy has helped a Bradford-based steel stockholding company increase its annual profits threefold.

Barrett Steel Ltd, of Dudley Hill, saw pre-tax profits rise to £20.9 million for the year to the end of September, up from £7.4 million the previous year.

The company's turnover increased from £136.8 million to £186.2 million.

Chairman Roy Butcher said it had been "an exceptional period" in stockholding markets and described the company's performance as outstanding. He added: "The rate of price rises announced in the first half of 2004 has now lessened. While the fundamentals of demand from the Far East and China in particular do not appear to have changed, supply is currently better matched to demand.

"We do not foresee a repeat of last year's dramatic price rises, although in the medium term we anticipate prices will continue to rise."

The continuing massive industrial expansion in China has led to a significant steel shortage coupled with rapidly rising prices, according to Low Moor-based construction cost consultants Rex Procter & Partners Ltd.

Paul Mackie, a partner in the firm said: "We've known about this problem for 18 months now. It's been driven by the buoyancy in the steel market and also the shortage of raw materials - iron ore."

Mr Mackie said the steel shortage was not just for structural steel but for other construction materials such as electrical fittings and claddings. It meant an overall, increase in the capital cost of construction projects.

David Warren, a partner at Cottingley chartered accountants MGI Watson Buckle said a number of his clients had been hit by the steel crisis.

He said one company, a user of specialist steel products, had suffered "all sorts of procurement problems". "They have had to try to source steel from all over the continent.

"It is also significantly pushing their costs up and it is very difficult for companies in manufacturing because they agree prices with their customers for a set period which means it is hard to pass that increase in cost on."

China has been by far the biggest drain on resources and that is expected to increase as the country starts to build hi-tech new stadia for the 2008 Beijing Olympics.

l Boom and boom - how the Chinese economy is hitting companies at home. See next Monday's Bradford Means Business supplement.