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Taiwan steel output in Q2 down over 5% y-on-y

TAIPEI--The production value of Taiwan's steel industry fell by more than 5 percent in the second quarter of this year from a year earlier as a result of a supply glut in the global market, a government report said Saturday.

In the report, the Industry and Technology Intelligence Services (ITIS) said the local steel sector's output totaled NT$330.9 billion (US$11.03 billion) during the April-June period, down 5.1 percent year-on-year. But the second quarter figure was up 9.4 percent from the first quarter.

The ITIS, a research institute under the Ministry of Economic Affairs, said as the pace of an economic recovery at home and abroad remained slow, demand for steel products turned weaker than expected, resulting in a supply glut during the three-month period.

Under such unfavorable circumstances, China Steel Corp., the largest steel maker in Taiwan, cut its domestic wholesale product prices for June deliveries by 2.8 percent from its April-May contracts.

The steel maker further lowered its domestic wholesale prices for July-August deliveries by 4.66 percent before it left wholesale prices for September contracts unchanged.

In the second quarter, Taiwan'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, the country's steel product imports reached NT$96.4 billion, down 3 percent year-on-year, but up 18.1 percent quarter-on-quarter.

Rolled steel products, including cold rolled steel, hot rolled steel and hot-dipped zinc-galvanized steel, were the major steel product exports from Taiwan in the second quarter. China, the United States, Indonesia and Thailand were the largest buyers, consumed 43 percent of the total exports, the ITIS said.

In terms of imports, the research division said 65 percent of Taiwan's steel purchases came from Japan, China, the U.S. and South Korea, with stainless and hot rolled steel comprising the largest category in imports.

During the April-June period, demand for steel products in Taiwan totaled NT$302.8 billion, down 11.5 percent from a year earlier, but up 1.7 percent from a quarter earlier, the ITIS said.

Meanwhile, the ITIS said the production value of the local screws and metal fasteners business for the second quarter rose 1 percent from a year earlier to NT$31.2 billion.

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