China Steel Corp (中鋼), one of Taiwan’s leading steelmakers, said on Saturday that its production capacity for next month is fully booked due to solid demand from its clients in the downstream steel industry.
Judging from the backlog of orders, China Steel said its shipments for next month are expected to remain steady compared with a shipment of approximately 1.02 million tonnes for this month.
However, due to the fewer number of working days this month as a result of the upcoming Lunar New Year holiday, shipments for the month will fall slightly from the 1.04 million tonnes recorded last month.
Last month’s shipments were calculated based on a combination of China Steel’s 750,000 tonnes and its unit Dragon Steel Corp.’s 286,000 tonnes.
Although the Lunar New Year holiday, which begins on Jan. 30 and will continue until Feb. 4, will cut the number of working days next month as well, the fully booked capacity will ensure that shipments for next month will offset the impact from the fewer working days and remain stable, the steelmaker said.
Due to the solid orders from downstream clients, China Steel said it expects its monthly production to range between 750,000 tonnes and 790,000 tonnes, while Dragon Steel could roll out more than 200,000 tonnes of steel products next month.
Analysts from President Securities said demand in China, which is one of the world’s major steel product consumers, is on the way to a recovery after recent inventory adjustments, so the outlook for the global steel market has improved.
Last month, Baoshan Iron & Steel Co (寶鋼股份), the largest steel maker in China, decided to raise the prices of its major products, including hot-rolled steel, for this month’s contracts by an average of 50 Chinese yuan (US$8.20) per tonne, after it left prices unchanged in the period running from October through last month.