This decision follows a series of price increases over the past four months and takes into consideration customers' inventory write-down costs. For the second quarter, China Steel plans a modest increase of NT$300 (US$9.5) per tonne for certain steel plates, while keeping prices unchanged for other products. Factors such as actual demand from domestic customers, market conditions, and economic outlook played a role in this decision.
Anticipating a potential uptick in steel demand after May, China Steel also expects a positive impact from anticipated US interest rate cuts, starting from June, which are predicted to stimulate investment, consumption, and economic activity. The company foresees benefits for various sectors including real estate, machinery, equipment, and vehicle sales, which would consequently drive steel demand.
China Steel remains optimistic about the overall stability of the steel market in terms of supply and demand, projecting sequential improvement in the upcoming quarters. Additionally, global steel prices are expected to rise in the second quarter following a period of consolidation in the first quarter. Recent announcements by US steelmakers and ongoing price increases by China's Baowu Steel Group Ltd indicate a potential turnaround in global steel prices.
Financially, China Steel reported a 5.91 percent year-on-year increase in consolidated revenue for the first two months of the year, with shipments reaching 1.93 million tonnes during this period. The company expects shipment volumes to further increase in the first and second quarters, with the latter anticipated to witness even higher volumes as the industry enters a peak season.
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