China Steel Corp (CSC, 中鋼), the nation’s biggest steelmaker, yesterday said it is to trim prices by a smaller-than-expected 0.4 percent for steel products to be delivered in October and November as nascent signs indicate an ease in oversupply.
The price cut is the smallest in a string of price slumps over the past nine months. The company cut its steel prices by 7 percent for products to be delivered this quarter.
The move by CSC took its cue from the pricing strategy of Chinese rival Baosteel Group Corp (寶鋼), which earlier this month maintained prices for its products to be shipped next month from this month ahead of high seasonal demand next quarter.
“Chinese steelmakers are keeping prices steady due to rising costs on a weak yuan,” CSC vice president Liu Jih-gang (劉季剛) said by telephone.
“Some Chinese companies are adjusting [downward] their output to stem [overcapacity-driven] losses. This is one of the new signs we have see lately, fueling hopes that global steel prices are poised to pick up,” Liu said.
On top of that, Southeast Asian steelmakers seem reluctant to sell at the current price, waiting for a price rebound in the near future, Liu said.
CSC kept prices unchanged for most of its products in order to cope with improving industry prospects and customer inventory adjustment plans for next quarter.
“We have only lowed prices for certain specialized steel products, such as those used in car manufacturing,” Liu said.
On average, the company is to cut steel prices by NT$61 per tonne, or 0.41 percent, for its October and November deliveries from this month’s contracts.
Analysts forecast CSC is likely to announce a 3 percent price reduction, the Chinese-language Economic Daily News reported.
The price of cold-rolled sheets and coils, which are used in automaking, is to drop by NT$231 per tonne, while that of benchmark hot-rolled sheets and coils is to slide NT$35 per tonne, the Kaohsiung-based company said in a statement.
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