China Steel Corp (CSC), Taiwan’s largest steel mill headquartered in Kaohsiung of south Taiwan, has decided to raise its list prices of major steel products by TWD 1,000-2,400/tonne ($35-84/t) for sales over April-June, partly to reflect higher production costs, according to a company release on March 15.
Taiwan steel mills’ profit margins had been highly squeezed as the “steep hike in steelmaking raw material and other commodity prices had significantly increased our production costs,” the company said in the release.
For example, the FOB price of coal from Australia has touched a new high of $660/t due to the frequent flooding in Australia and the conflict between Russia and Ukraine. Meanwhile, the imported iron ore prices have increased to over $160/t CFR Taiwan, and those of imported scrap also exceeded $650/t CFR Taiwan, CSC noted.
The tensions between Russia and Ukraine have become an uncertainty for the recovery of the global economy in the post-pandemic era, which may exacerbate the pressures of global inflation, increase the risk of exchange rate fluctuations, and lead to the imbalance between supply and demand for bulk commodities in the global market, the company release noted.
Russia and Ukraine are two major countries of steel production in the world with their combined crude steel output reaching approximately 100 million tonnes/year, and their steel exports exceeding 40 million t/y, according to the release.
Besides, the sharp rise in crude oil and natural gas prices may also push up fuel and transportation costs, CSC noted.
The second quarter is the traditional peak season for steel consumption in Taiwan, as downstream users will return to the market for replenishment. Meanwhile, “Taiwan’s steel exports are likely to perform well this year, and the rise in global steel prices may not be less than last year,” CSC predicted.
Major steel mills in the world have lifted their list prices for sales over April-May, and hot-rolled coil (HRC) prices in the Asian market may hit $1,000/t in Q2, CSC noted.
Baoshan Iron & Steel Co (Baoshan Steel), the listed arm of the world’s top steel producer China Baowu Steel Group, has announced to raise its list prices of carbon steel HRC by Yuan 200/tonne ($31.6/t) for April domestic sales, as Mysteel Global reported.
Written by Nancy Zheng, zhengmm@mysteel.com
This article has been published under an exchange agreement between MySteel Global and SteelMint.
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