You are seriously doubting the quality of steel from a known exporter of military equipment to practically every developing nation around the world? Norinco isn't your run of the mill, rinky dink arms supplier who would even consider cutting up old railways for use in their products.
The communists are known for their steel production, Soviet, Chinese, the list goes on and on. Centrally planned economies rely on the steel mills and foundries, and given that the communists had to employ their people, they've had a long history and tradition of making metal into guns for their army.
Also, the price of steel is so incredibly cheap in China, I'd be surprised that more products known for lower quality steel, were actually made of a higher grade in China.
You, sir, are pulling numbers out of your ass. Go do some research and actually examine the metallurgy on current production Norinco guns before you start bashing them.