Taiwan CSC rolls over steel list prices for Nov sales

China Steel Corp (CSC), the largest steel mill headquartered in South Taiwan's Kaohsiung, has decided to roll over its steel list prices for sales in November, given the expectation for firm demand this quarter and the challenges its downstream customers face, according to the company's monthly pricing policy released on October 15.

For the last quarter of 2021, Taiwan's economy is likely to recovery further overall on support of measures taken by the government to boost local consumption, CSC pointed out in the release.

For the first three quarters of this year, Taiwan's total export value reached $324 billion, the highest ever recorded for the nine-month period, mainly thanks to the effective control of the COVID-19 outbreak both in Taiwan and other countries and regions thanks to widespread vaccinations.

Global steel demand is expected to continue improving over 2021-2022 with the steady growth in the global economy, the steelmaker said. The latest forecast of the World Steel Association (WSA) suggests steel demand globally may grow 4.5% on year to 1.86 billion tonnes in 2021 and will continue to grow by another 2.2% on year in 2022.

Steel supply in the global market is likely to remain tight due to China's intensive "dual controls" on energy consumption and energy intensity and the tougher winter curbs in North China's Beijing-Tianjin-Hebei region from mid-November to meet Beijing's crude steel output reduction target and to improve air quality, CSC said.

Production costs for steelmakers are also increasing - due to the higher prices of steelmaking raw materials including imported iron ore, metallurgical coal and ferroalloys - which will also lend some support to steel prices in Asia this quarter, it added.

To achieve the company's target of reducing carbon emissions by 7% by 2025 compared with that for 2018 and to achieve zero carbon emissions by 2050, CSC will add a carbon surcharge in its steel list prices in future to cover its investment in processes to reduce carbon emissions and for the installation of environmental protection equipment.

However, CSC has nonetheless decided to keep its November steel list prices stable as its downstream customers face dual challenges of high inventories at hand and capital management. "Production and sales among our downstream customers have been slowed due to the disruptions in global shipping," a company official said.

In September CSC's carbon steel sales had slipped for the fourth month, declining by another 32,129 tonnes or 4.1% from August to 748,647 tonnes and refreshing the lowest since March, as reported.

Major steel mills worldwide, such as Baoshan Iron & Steel in China and Formosa Ha Tinh in Vietnam, had also opted to hold their new steel list prices, persuading CSC to adopt a similar tactic, according to the release.

Written by Nancy Zheng, zhengmm@mysteel.com
Edited by Russ McCulloch, russ.mcculloch@mysteel.com
This article has been published under an article exchange agreement between Mysteel Global and SteelMint.