The couple became almost penniless. Mao, two months pregnant, was afraid that they could not afford to feed the coming baby.

"I have wept many times at night, but I have to pretend to be strong in the daytime, for I do not want to pass more stress to my husband," she said.

The industrial downturn has affected China's major cities, ranging from western Xi'an and Guiyang to eastern coastal cities like Ningbo, Hangzhou and Xiamen, where stories of bankrupt scrap dealers and recycling firms are frequently reported.

Xu Chuanzhou, a junk dealer in Zhengzhou, Henan province, which is 700 km away from Beijing, also saw his daily income of 80 yuan cut in half since September.

"I can earn only one cent from a can now," Xu said. He decided to stop purchasing pop cans and plastic bottles to prevent further losses.

Statistics from the China Resource Recycling Association showed during the third quarter, scrap prices dropped by half and 80 percent of the reclamation depots closed.

"Millions of urban and farm workers engaged in the trade are likely to lose jobs and the recycling rate has dropped by 70 percent, causing greater environmental problems," said a post on the association's website.

Analysts predict consumption of raw materials in China would remain weak if industrial production growth continues to decline.

It is a domino effect along the industry chain.

"Orders from steel mills and chemical fiber factories have been fairly reduced from September," said Huo Dong, manager of the Chuangye Recycling Co Ltd, located in Beijing's Chaoyang District.

It was reported that 60 percent of China's steel mills lost money in October. Half of the mills around Tangshan city, a steel-manufacturing center close to Beijing, have stopped production.

Huo's company used to deliver 800 to 1,000 tons of scrap iron per month to steel mills in Tangshan, Baoding and other neighboring cities, but the volume has dropped to less than 400 tons since November.

"Only a handful of our old clients have placed new orders since November," said Huo, who now makes scrap purchases strictly according to orders.