China Steel Corp. raises domestic prices ahead of expected economic recovery
CNATAIPEI, Taiwan -- China Steel Corp., Taiwan's largest steel maker, has decided to raise domestic wholesale product prices for its April and May contracts from March due to rising demand from local firms in the middle and downstream steel making sector, which need to restock for the economic recovery.
March 1, 2013, 12:03 am TWN
In a decision made by China Steel Wednesday, its products will see an average price hike of NT$802 (US$27.09) per metric ton or 3.81 percent for the April to March delivery period.
In addition to higher domestic demand, the price hikes also reflect rising international steel product prices and the New Taiwan dollar's depreciation against the U.S. dollar, which has boosted the steel maker's production costs, China Steel said.
China Steel said that as the European Central Bank has continued its liquidity easing measures to stimulate the economy, and the United States, the world's largest economy, has kept reporting improved economic data, business and consumer confidence has revived globally to some extent.
In China, the second largest economy in the world, exports and industrial production has staged a rebound at a time when fixed capital formation on the mainland is continuing to expand, the steel maker said.
At home, the Taiwan government has raised its forecast for the country's economic growth for 2013 to 3.59 percent from an earlier estimate of 3.53 percent on the back of an expected recovery in exports and private consumption, the company said.
Under such favorable circumstances, steel prices in the global market and iron ore, which is a major raw material used in steel production, has continued to climb, it said.
Under the latest price hikes, prices of steel plates, steel wire rod, hot-rolled steel, and cold-rolled steel will be raised by NT$78, NT$700, NT$1,069, and NT$896, respectively, per metric ton.
Meanwhile, prices of electro-galvanized steel coils, electrical steel coils and hot-dipped zinc-galvanized steel have been raised by NT$800, NT$602, and NT$901, respectively, per metric ton.
Looking ahead, China Steel said that steel prices are expected to trend higher as the second quarter is considered the traditional peak season for the steel industry in which the pace of inventory adjustments will rise to lift demand.