China's biggest listed steelmaker, Baoshan Iron & Steel, will cut its main steel product prices for June, its first reduction in nine months and underscoring demand worries amid a fragile economic recovery.
Pricing moves by the firm, known as Baosteel, usually set the tone for the wider steel sector, with the cut coming as China's steel demand falls short of expectations and as a supply glut worsens.
Baosteel, which kept May prices steady after five straight months of hikes, will cut June prices of hot-rolled coil mainly for manufacturing by $29 a tonne and cold-rolled coil, principally for autos and domestic appliances, by $24 a tonne, the company said on Thursday.
“Baosteel has already been giving discounts of up to $32 a tonne for May bookings even though it had announced that it would keep prices steady,” said an analyst with steel trading platform Xiben New Line Co Ltd in Shanghai.
“The decision to cut June prices suggests it is having difficulties in getting orders.”
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