The production value of Taiwan’s steel industry fell by more than 5 percent in the second quarter of the year from a year earlier as a result of a supply glut in the global market, a government report said on Saturday.
In the report, Industry and Technology Intelligence Services (ITIS) said the steel sector’s output stood at NT$330.9 billion (US$11.03 billion) during the April-to-June period, down 5.1 percent year-on-year, but up 9.4 percent from the first quarter.
The research institute said that as the pace of economic recovery at home and abroad remained slow, demand for steel products was weaker than expected, resulting in oversupply during the three-month period.
Under such unfavorable circumstances, China Steel Corp (中鋼), the nation’s largest steelmaker, cut its domestic wholesale product prices for June deliveries by 2.8 percent from its April-to-May contracts.
The steelmaker further lowered its domestic wholesale prices for deliveries last month and this month by 4.66 percent, but left prices for next month’s contracts unchanged.
In the second quarter, the nation’s steel product exports totaled NT$124.5 billion, down 8 percent from a year earlier, but up 4.7 percent from last quarter.
Meanwhile, imports of steel products reached NT$96.4 billion, down 3 percent annually, but up 18.1 percent on a quarterly basis.
Rolled steel products, including cold rolled steel, hot rolled steel and hot-dipped zinc-galvanized steel, were the major exports in the second quarter.
China, the US, Indonesia and Thailand were the largest buyers, consuming 43 percent of Taiwan’s total exports, ITIS said.
In terms of imports, ITIS said that 65 percent of Taiwan’s steel purchases came from Japan, China, the US and South Korea, with stainless and hot rolled steel accounting for the largest volume.
During the April-to-June period, national demand for steel products totaled NT$302.8 billion, down 11.5 percent from a year earlier, but up 1.7 percent from a quarter earlier, the research institute said.
ITIS said the second-quarter production value of the domestic screws and metal fasteners sector rose 1 percent from last year to NT$31.2 billion.
In the same quarter, exports of Taiwan-made screws and metal fasteners fell 1 percent from a year earlier to NT$29 billion, with the average price per kilogram down 3.2 percent year-on-year at NT$78.5.
The US was the largest buyer in the period, accounting for 38 percent of Taiwan’s total exports, ahead of Germany at 9 percent, Japan at 6 percent, the Netherlands at 5 percent and the UK at 4 percent.
Taiwan’s screw and metal fastener imports for the second quarter hit NT$1 billion, down 18 percent from a year earlier.
Japan was the nation’s largest supplier, providing 49 percent of imports, followed by the US with 13 percent, China with 9 percent, Germany with 6 percent and the Philippines with 3 percent.