On September 15th, 2021, China Steel Corporation (CSC) holds a price meeting for domestic sales of fourth-quarter/October shipment in 2021 and announces the following statement:

As global economy remains strong, global GDP growth rate is projected at 5.4~6.0% this year. Benefiting from large scale of infrastructure plans launched by the US, China, EU and India governments, steel demand is also in prosper perspective. In Taiwan, “International Commercial Port Future Development and Construction Plan” approved by Executive Yuan is estimated to bring in NT$320 billion worth of investment from both public and private sectors.

Economic performance gets strengthened from the stable recovery of global economy. Taiwan’s Executive Yuan will launch a new COVID-19 relief package in October, which is expected to boost domestic consumption. The government raises the GDP growth rate forecast to 5.88% in 2021, reaching a record high since 2010. Having said that, IMF also warns the economy might show uneven recovery in different countries given that COVID-19 is still threatening global economy.

Affected by the new environmental protection policies and seasonal maintenances among major mills across the world, global steel industries still face short supply in the coming quarter. Among those, China is targeting to reduce 6.0 million MT of crude steel in second half of 2021, and also cancels export tax rebate at the same time to reduce export quantity in order to ensure its domestic demand can be fulfilled. On the other hand, Nippon Steel is planning to reform its capacity by closing three Blast furnaces by the end of 2021. In additional, starting from September, half of the blast furnaces in Tangshan China are shutting down for maintenance, and five hot strip mills will be closed for annual overhaul in South Korea. Mills maintenances will also be seen in the US.

US steel prices keep reaching to record high, as HRC price has surged to above US$2,100/MT and CRC price is close to US$2,400/MT. The anticipated agreement between the EU-US on Section 232 tariffs would boost steel export sales to the US and, consequently, drive the steel prices up in Europe. Besides, Nippon steel and Toyota has reached a 10-year-record-high price increase agreement of JPY20,000/MT(US$182/MT) for the second half of 2021 fiscal year (October 2021 to March 2022), which is expected to boost steel prices in other downstream industries, such as home appliances, construction and shipbuilding. Though iron ore price has fallen recently, coking coal price has soared to above US$350/MT due to China’s import ban on Australian coal and supply disruption caused by the epidemic in Mongolia. With the cost of raw materials and freight charge are still at the high end, steel prices are expected to maintain strong in Q4.

With the trend of carbon neutrality, major advanced countries have actively introduced emission trade system and plan to impose carbon tax or surcharge. A new era of high steel prices is coming. In response to extreme weather and ESG issue, CSC has already invested in advanced environmental technology and commissioned research institution to conduct carbon footprint analysis. We will look forward to cooperating with downstream industries to lift up the value of steel supply chain together.

Even though the steel demand might be dragged down by the pandemic in South East Asia and the disturbance of global logistic, as steel industry entering traditional peak season, momentum from downstream industries is expected to remain strong. After evaluating the market trend, production cost and most of all, the competitiveness and benefits of our downstream customers, CSC hereby announces to raise the prices by 1.32% in average for October-shipment and the fourth-quarter shipment products of domestic sales in 2021. Prices adjustment shown as below table.

Price Adjustment for Domestic Sales of the Fourth Quarter/October shipment of 2021