China Steel says orders rebound since May as stockpiles fall
Taiwan’s largest steelmaker, China Steel, said orders rebounded after customers depleted stockpiles, signalling a recovery from the sales plunge in May.
There was a shortage of steel in Taiwan after the company shut a furnace for maintenance, China Steel executive vice- president Chung Le-min said last month from Kaohsiung, where the company is based.
The revival in orders will not stop China Steel from reporting a loss for the April-to-June period, as the mill sold products below cost, Chung said. China Steel posted losses for two straight quarters as the global recession reduced demand from builders and automakers.
“Market sentiment has improved a little,” Chung said in the telephone interview. “The market was at its worst from mid-April to around May 10.”
China Steel advanced 2,2% to close at NT$27,90 in Taipei trading. The stock has climbed 21% this year, compared with a 39% gain in the benchmark Taiex index.
The company said that it would raise prices for domestic customers by an average 7% for July and August, the first increase this year. This came after it had reported a 52% plunge in May sales to NT$11-billion, or $335-million, according to a June 9 stock exchange filing.
China’s largest steelmaker, Baoshan Iron & Steel, increased prices by 11% for cold-rolled products for July delivery, the Mysteel Research Institute said on June 10. The country’s fourth-largest listed mill, Maanshan Iron & Steel, also raised July prices by 8,9%.
China Steel runs four furnaces with a total annual capacity of 10-million tons. The number three plant, with a 2,8-million-ton capacity, was shut in April for main-tenance.