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| Baosteel Cuts Domestic Steel Prices Again For Dec Shipments |
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China's Baosteel Co Ltd has taken the plunge and reduced its domestic sales prices of various steel products again for December shipments, according to information made available in Tokyo. In late October, Baosteel executed a major price reduction such as Yn1,000/ton (US$147) for HR coils when the company settled its domestic sales prices for December shipments. With a continued fall in China's domestic steel market, though, the company is thought to have executed another major price reduction for December shipments in efforts to make domestic market prices bottom out while eliminating the prospects of a descending domestic market. Baosteel's new domestic prices for December shipments have yet to become clear. But it is understood that additional price reductions of main products are settled at Yn1,000/ton (US$147) for HR coils, Yn800/ton (US$118) for CR coils, and Yn700/ton (US$103) both for hot-dip galvanized sheets and electrolytic galvanized sheets. As a result, it follows that HR coils are subject to a cumulative price reduction of Yn2,000/ton (US$294) so far for December shipments. With a second price reduction, the new price of HR coils for December shipments is viewed as Yn2,992/ton (US$440) before value-added tax. By comparison, what Wuhan Iron & Steel Group Corp charges for HR coils translates into a level of US$432/ton for December shipments. What Baosteel settled in late October as its domestic sales prices for December shipments was higher by the equivalent of nearly US$100/ton as a whole than domestic market prices then. With the additional price cuts this time, it follows that the company has brought its domestic sales prices into line with domestic market conditions. Baosteel is expected to work out its domestic sales prices within this week for shipments in the January-March quarter of 2009. There is speculation that the company may apply flat prices in January shipments in favor of raising prices from February shipments. Meanwhile, Anshan Iron & Steel Group Corp (Ansteel) is likely to inform domestic customers this week of its domestic sales prices for December shipments, market sources forecast. It remains to been whether Ansteel will underprice Baosteel for December shipments, according to market observers. |
| last modified : Fri 28 Nov, 2008 [10:02] |
