China Steel Corp (CSC, 中鋼), the nation’s biggest steelmaker, yesterday announced that next quarter it would raise domestic prices for most steel products to reflect rising raw material costs.
It would hike the prices for benchmark hot-rolled sheets and coils by NT$490 per tonne and cold-rolled sheets and coils — which are used in the automotive industry — by NT$300 per tonne, the Kaohsiung-based steelmaker said in a statement.
The company would also increase the prices for electro-galvanized sheets by NT$300 per tonne, electrical sheets by NT$300 per tonne and hot-dipped, zinc-galvanized sheets by NT$350 per tonne, it said.
However, to support the export competitiveness of domestic downstream customers, the company has decided not to adjust the prices for steel bars and rods, and steel plates, it said.
“Low-priced steel products are no longer disrupting the global market, because the Turkish lira and Russian ruble are stabilizing, and their steel suppliers are reducing output due to maintenance,” the company said.
“In the meantime, major US steel mills; European steelmaker ArcelorMittal SA; and China’s Baoshan Iron & Steel Co (寶鋼), Wuhan Iron and Steel Corp (武鋼), and Angang Steel Co (鞍鋼) raised their prices at the beginning of this year, indicating that the market had bottomed out and is staging a rebound,” CSC said.
“In general, steel prices have increased by more than US$50 per tonne from the low levels seen last year, while the rising costs of coking coal and iron ore, buoyed by seasonal factors and mining accidents in Brazil, have pushed steel prices further up,” the company said.
CSC expects the recovery to extend into next quarter, citing healthy supply-demand dynamics in Japan, South Korean steel mills’ rising export prices and higher steel demand in China as Beijing launches incentives to combat an economic slowdown.
Trade tensions between the US and China have eased, helping buoy business confidence, it added.
The company’s latest move highlights how fast market dynamics have changed over the past three months. In late November, CSC slashed prices for some of its products for this quarter by between NT$300 and NT$900 per tonne, and gave a downbeat outlook for the year due to rising uncertainties about global trade.
CSC said it is also positive about Taiwan’s steel market, as local demand should increase steadily this quarter and in the coming quarters thanks to public infrastructure projects and Taiwanese businesses moving their overseas operations home.
“Since downstream Taiwanese steel firms play a key role in the global supply chain, export orders for machine tools and motors in the second quarter are expected to restore demand and boost the market,” it said.