China Steel Corp to hold steady domestic steel prices

China Steel Corp (CSC, 中鋼), the nation’s biggest steelmaker, yesterday said it is holding steady steel prices for domestic delivery next month and next quarter, as the global steel industry’s recovery is taking shape amid an improving world economy next year.

Before the arrival of a major pickup, the Kaohsiung-based company said steel demand would be muted during the first quarter of next year due to seasonal weakness and the arrival of Lunar New Year holidays.

Customers are taking a wait-and-see approach before US president-elect Donald Trump takes office next month, given uncertainty about the US’ new trade policy, CSC said in a statement.

The industry is hopefully heading to a recovery next year, snapping two straight years of contractions, attributable to a healther supply-demand situation, the steel company said.

Global steel demand is to rise 1.2 percent annually to 1.77 billion tonnes next year, driven by easing monetary policies in Europe and new economic stimulus packages launched by Beijing, CSC said yesterday, citing a forecast made by the World Steel Association.

In Taiwan, industrial production expanded for an 8th consecutive month last month, boosting demand for more manufacturing facilities, machinery equipment and servers, CSC said.

On the supply side, new signs showed a potential tight supply in China, the world’s biggest steel producer and consumer, CSC said.

Data compiled by the China Iron and Steel Association (中國鋼鐵工業協會) showed that crude steel inventories in China have fallen 11.8 percent year-on-year as of the first half of this month, reaching the lowest level since 2020, CSC said.

Overall, the world steel industry is currently going through a correction, CSC said.

Before the arrival of a solid pickup, China Steel plans to keep steel prices flat for domestic customers during the upcoming quarter in an effort to help downstream customers better manage their raw material costs, the company said in the statement.

In China, China Baowu Steel Group Corp (寶武鋼鐵集), the world’s largest steel company, and Angang Steel Co (鞍本鋼鐵) have hiked steel plate prices for delivery next month after prices for hot-rolled steel jumped as an improving Chinese economy spurred steel demand, CSC said. The price hikes would help bolster steel price quotes in the Asian market, it said.

CSC in a separate statement said that its pre-tax profits surged 41 percent year-on-year to NT$3.75 billion (US$114.8 million) during the first 10 months of this year, thanks to significant gains from mining investment.

However, operating profit tumbled 34 percent to NT$944.5 million during the 10-month period ending in October, it said.