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| Ansteel's More Domestic Price Cut For Oct Shipments |
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China's Anshan Iron & Steel Group Corp (Ansteel) is poised to price down HR coils and other steel products by an additional Yn400/ton (US$59) for October shipments when each shipment is made out of the company's works, according to information made available in Tokyo. Ansteel has already reduced its domestic sales prices of October shipments by Yn600/ton (US$88) for commodity-grade HR coils and by Yn400/ton for hot-dip galvanized sheets. With the additional price reduction, it follows that the company will reduce what it charges for HR coils by a cumulative Yn1,000/ton (US$147) so far. Meanwhile, Baosteel Co Ltd informed domestic customers last week of price cuts of Yn700-800/ton for November shipments of sheet products such as HR coils, CR coils, and hot-dip galvanized sheets. As a result, Baosteel's new sales price of HR coils is somewhat lower than Ansteel's present sales price. Ansteel's sales prices of steel products are usually lower than Baosteel's corresponding prices by estimated values of US$30-60/ton. Accordingly, it is understood that Ansteel has opted to execute lower sales prices in a hurry this time than Baosteel's price practices, thereby struggling for assured sales volumes. There are signs that Ansteel is having a tough time collecting orders despite the existing price cuts for October shipments because a wait-see-position is predominant among domestic customers. In this connection, Ansteel is believed to have continued its full production as usual until now even at a time when small and midsize steelmakers are forced to reduce what they put out in a domestic environment that precludes increased sales volumes even if reduced prices apply, according to market observers. There was a strong feeling earlier in market sources that China's domestic demand for steel products would head for a recovery once the central government implements measures to stimulate economic growth since steel mill and distribution stocks of steel products stand at a low level on the whole. At present, though, there are fears that China's domestic market conditions for steel products may sink to a "second bottom" if Ansteel maintains its full production, leading to increased steel mill stocks of steel products amid a hostile environment. |
| last modified : Tue 30 Sep, 2008 [11:10] |
