China Steel Corp, the nation’s only integrated steelmaker, said on July 19th it would keep its domestic steel prices for September shipments unchanged from the July-August contract prices, following two consecutive cuts since last month.

The company attributed its latest decision to an easing of oversupply in China and higher prices of iron ore — a raw material for making steel.

Because of overproduction in China, the Taiwanese company in April lowered its prices for June shipments by an average of NT$442 per tonne, and last month cut prices for July and August contracts by NT$1,000 per tonne.

Daily production by Chinese mills reached 2.08 million tonnes during the first half this month, down from last month’s 2.18 million tonnes and May’s between 2.15 million and 2.2 million tonnes, China Steel vice president Liu Jih-gang said by telephone.

As a result, China’s Wuhan Iron and Steel Co, Baosteel Group Corp and Angang Steel Co Ltd raised their prices recently, Liu said.

US steel companies also increased prices recently, while major Japanese and European mills are likely to follow suit, Liu said, adding: “We have a feeling that global steel prices have touched bottom.”

Steel demand in Taiwan is stable, and the company expects the local economy to perform better in the second half, Liu said.

However, given the proliferation of cheap steel products, the company decided to keep steel prices unchanged for a month while it considers whether to raise prices in the future, he said.

Lin Chung-yi, another vice president at China Steel, said the price cuts for July and August contracts would mean a sequential fall in sales this quarter.

However, revenue and profit for this quarter would increase from a year ago because of higher production volumes and improved cost control, he said. (Source: www.taipeitimes.com)