Price Announcement for 2015 March Domestic Prices

2015-01-21

On Jan 16th, 2015, Taiwan’s China Steel Corporation (CSC) held the domestic pricing meeting for March 2015 delivery, and announced the following statement.
On global economic perspective, since the US economic indicators remain high, improvements in labor market and payroll strengthen consumer confidence, and Fed is unlikely to raise rate in advance, thus US’s long-term economic outlook stays optimistic. However, due to political instability in Greece, depreciation of Euro, sluggish recovery and the risk of deflation in Euro Area, the persistent quantitative easing will still be the main policy for ECB. In China, reduction in new orders with falling manufacturing and investment lead to decline in PMI, and People’s Bank of China has cut interest rate in response. Nevertheless, GDP growth in the coming year still faces the risk of slowing down. Overall speaking, global economy maintains growth, but differences among regions tend to reveal.
In Taiwan, due to depreciation of NTD and low oil price, both export and consumption increased. DGBAS(Directorate-General of Budget, Accounting and Statistics) revised this year’s GDP growth up to 3.5%, implying that the overall economic performance is better than last year.
Slow growth in steel demand resulted in depressed steel price. Influenced by cheap imports, steel price in the US has plunged; nevertheless, early recovery of downstream automotive and construction industry supported steel demand. Although demand in Europe is still slack, the EU launched the € 300 billion stimulus program, along with the increase of steelmaking cost caused by depreciation of EUR. ArcelorMittal has announced a price hike after new year, but demand is likely to grow in slow pace. China formally implemented new environmental standards in 2015, which might eliminate the obsolete production capacity and accelerates mergers and acquisitions, looking forward to soothing contradiction between supply and demand. Moreover, after the removal of tax rebate on boron-added plate and wire rod, price competition in Asia has relieved temporarily, along with the stabilization of coking coal and iron ore price lately, the global steel price might rebound in 2015 Q2.
Domestic downstream steel industry was affected by international political and economical environment, and deferred release of demand, making market participants become conservative and remain hesitant to place orders. Since Taiwan’s China Steel Corporation (CSC) held the domestic pricing meeting for January and February 2015 delivery in November 2014, , international steel price went down and export prices of each country continued to fall due to weak demand, causing a price gap between CSC and international market. Accordingly, following international steel price and considering downstream competitiveness, CSC has decided to make proper adjustment to steel products’ prices, overall price has been cut by 2.27% in average, i.e., about NTD 425/MT, except bars and rods.
Market share of the imported low-priced plates to Taiwan has continued to increase significantly year by year, and it impacts domestic industry serieously. Recent data shows that it has risen from 29% in 2013 to 32% in 2014. To keep business environment healthy, CSC will file an anti-dumping petition for steel plate soon.
Prices Adjustment for 2015 March Domestic Sales
Products    Adjusting Amounts (NT$/MT)
Plates    - 360
Bars and Rods    0
HRC    - 622
CRC    - 842
EG    - 600
ES    - 504
GI    - 600


Information Origin : http://www.csc.com.tw/CS/CSC_E/NC/neli/neli.aspx

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