Taiwan-based China Steel Corp (CSC) lowered its sale prices for finish steel prices by NT$300/mt ($9.6) for May shipments. The company’s outlook for domestic steel demand remains stable as the COVID-19 outbreak is well-managed in Taiwan.
CSC announced a price cut for its May shipments of finished steel on Friday. The price cut is intended to incentivise end users to buy more finished steel amid the COVID-19 pandemic. In Asia, many steelmakers including Baosteel in China, Tokyo Steel in Japan, Formosa Steel in Vietnam, have announced price cuts for their April-May shipments.
In February, CSC group’s carbon steel sales were 952,499mt, up 17pc from 811,988mt in January. Domestic sales contributed to 69pc of total sales.
Taiwan’s government had taken proactive steps to minimise the impact of the COVID-19 pandemic. The country’s supply chain had little impact of the virus lockdowns in China. Taiwan’s economy is expected to remain comparatively stable than its Asia or global counterparts providing a stable demand outlook for domestic steel in Q2 2020.
Effective from May 1, the company lowered its sale prices for finish steel including hot-rolled steel plates, hot-rolled steel coils (including API), hot-rolled and cold-rolled steel pipes, electro-galvanised sheets and pre-painted galvanised steel coils by NT$300/mt ($9.9/mt) from the last set of prices. The prices for electrical sheets would remain unchanged, according to the company’s statement accessed by Davis Index.
To minimise the economic impact of the virus, many governments have introduced measures such as currency easing, fiscal expansion, and corporate tax reduction and relief. The company expects that the short-term negative impact of the epidemic will be mitigated by these policies. The company has made a moderate adjustment to its the domestic steel products prices in May.
Financial results
In February, CSC’s revenue lowered by 8pc to NT$26.06bn from the prior month. For February 2020, the steelmaker’s pre-tax losses were NT$794.39mn, down from NT$1.26bn. Decline in CSC’s profit was notably lower driven by stabilising domestic steel demand, compared to double-digit declines posted for the last five consecutive months.
(NT$1=$0.032)