Prices Announcement for Domestic Sales in the Second Quarter of 2019
2019-03-11
On March 8th, 2019, China Steel Corporation (CSC) held a domestic price meeting for the second quarter domestic sales and announced the following statement:According to the latest report of IMF, the global economic growth rate estimated to be 3.5% for this year, lowered by 0.2% than the estimation last October. Global economic expansion slowed down by international political and economic events, such as China-U.S trade conflict and Brexit that increased uncertainty risks; however, the economy in Europe and the U.S continues in stable growth, the Fed is expected to keep steady interest-rate this year, which is conductive to financial stability in emerging market like Southeast Asia. Despite growth in China is slowing down, the government keeps lowering reserves to release fund and promoting large-scale tax cuts to stimulate the economy.
As low-price disturbing factors have gone from Asia steel market due to the appreciation of Turkish lira and many facility-revamping plans in Russia this year. Since Nucore and some major steel mills in the U.S, Arcelor Mittal in Europe, as well as Baowu and Angang in China, all have successively raised prices after Lunar new year. Global steel markets have bottomed out, lifted by 50 USD/MT or more from the latest lowest point, and continued to move up. Moreover, as coking coal and iron ore prices stand high caused by seasonal factors in Australia and dam collapse accident in Brazil, the raw material factors will support steel prices to rise further. In Japan, due to solid domestic demand, frequent problems occurred in integrated steel mills resulted in tight supply, export volume has ducted and steel prices are going to push up. Similar to Korea, in order to reflect cost and steel prices pulled up by imports, Korean mills also are active to promote their domestic and export offers. In China, with upcoming traditional demand season known as “Gold March & Silver April”, and stimulus policies targeting infrastructure investment, white goods and automobiles, it is expected that steel demand to be driven accordingly. As the U.S. government has announced that the tariff hike of 200 billion US dollar commodities is postponed, it means that the worst time has passed, and global confident looks toward to recover gradually, and investment and consumption are going to back on track. Along with the need to recover inventory to be released, it is expected that the steel price raising momentum in the 2nd quarter will be sustained, and the global market will spiral up.
In Taiwan steel market, with the commencement of public construction, housing project released and returns of Taiwanese companies from abroad, construction steel demand will grow quarter by quarter. Downstream of Taiwan steel industry plays a vital role in the global supply chain, with China-US trade war eased, overseas orders for machines and motors will reveal, which helps boost market buy-side and recovery needs.
While it is strong and clear that material cost and international steel price increased in 2Q, in order to maintain downstream competitiveness and take into account of different characters and operating conditions of separate industries, CSC decided to make a modest adjustment for the 2nd quarter price. Besides of plates and wire rods to be remained flat, other steel products will be increased slightly. The adjustment ranges of each steel products are shown as the following Table.
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Prices Announcement for Domestic Sales in the Second Quarter of 2019: |
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|
Products |
Average Adjusting Amount (NTD/MT) |
|
Plates |
+0 |
|
Bars and Rods |
+0 |
|
HRC |
+490 |
|
CRC |
+300 |
|
EG |
+300 |
|
ES |
+300 |
|
GI |
+350 |
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