China Steel Corp (中鋼) yesterday held steady domestic steel prices for delivery next month, snapping four straight months of upticks as customers digest the effects of price hikes and macroeconomic factors.
The steelmaker said its move matched steps made by Chinese peers Baowu Steel Group Ltd (寶武鋼鐵), the world’s biggest steelmaker, and Angang Steel Co (鞍山鋼鐵), which both paused price hikes for hot-rolled and cold-rolled steel for domestic delivery next month.
“China Steel has been hiking prices following the global steel market’s uptrends since the beginning of this year, but it will take more time for the supply chains to pass the higher costs to downstream clients,” China Steel said in a statement.
Photo courtesy of China Steel Corp
Customers have reduced inventory to healthy levels, but they became conservative about building inventory to cope with the steel industry’s peak season this quarter, as banking turmoil in the US and Europe as well as escalating geopolitical tensions weakened their confidence, the Kaohsiung-based company said.
“Steel prices would enter a transition period in the short term,” it said.
The company said that steel prices would probably start trending upward again after the short pause, given that most Asian steel markets are entering a benign consolidation phase before any breakouts.
Steel prices in the US and Europe are rebounding thanks to improved consumer confidence, it said.
In addition, a pull back in raw material costs is also keeping global steel prices from climbing, the statement said.
Iron ore prices have fallen to between US$120 and US$130 per tonne, while coking coal prices fell to between US$285 and US$300 per tonne, it said.
However, China Steel has a positive view, expecting that demand would bounce back later this year due to improving demand for housing projects and home appliances as the government rolls out tax incentives to upgrade to green products.
To align with the muted market sentiment in Taiwan and the rest of Asia, China Steel said it did not adjust its domestic prices, although manufacturing costs are on the rise.
The company expects its electricity bill to surge by NT$1.2 billion (US$39.39 million) annually after Taiwan Power Co (台電) increased electricity rates by 17 percent for industrial heavy users starting this month.
Higher global crude oil prices and rising water prices also pushed up manufacturing costs, China Steel said.
Prices for its hot-rolled and cold-rolled steel plates, electro-galvanized steel coil used in building construction, as well as galvannealed steel coil used in home appliances and computers would remain at last month’s levels, it said.
The New Taiwan dollar is on the verge of overtaking the yuan as Asia’s best carry-trade target given its lower risk of interest-rate and currency volatility. A strategy of borrowing the New Taiwan dollar to invest in higher-yielding alternatives has generated the second-highest return over the past month among Asian currencies behind the yuan, based on the Sharpe ratio that measures risk-adjusted relative returns. The New Taiwan dollar may soon replace its Chinese peer as the region’s favored carry trade tool, analysts say, citing Beijing’s efforts to support the yuan that can create wild swings in borrowing costs. In contrast,
Nvidia Corp’s demand for advanced packaging from Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) remains strong though the kind of technology it needs is changing, Nvidia CEO Jensen Huang (黃仁勳) said yesterday, after he was asked whether the company was cutting orders. Nvidia’s most advanced artificial intelligence (AI) chip, Blackwell, consists of multiple chips glued together using a complex chip-on-wafer-on-substrate (CoWoS) advanced packaging technology offered by TSMC, Nvidia’s main contract chipmaker. “As we move into Blackwell, we will use largely CoWoS-L. Of course, we’re still manufacturing Hopper, and Hopper will use CowoS-S. We will also transition the CoWoS-S capacity to CoWos-L,” Huang said
Nvidia Corp CEO Jensen Huang (黃仁勳) is expected to miss the inauguration of US president-elect Donald Trump on Monday, bucking a trend among high-profile US technology leaders. Huang is visiting East Asia this week, as he typically does around the time of the Lunar New Year, a person familiar with the situation said. He has never previously attended a US presidential inauguration, said the person, who asked not to be identified, because the plans have not been announced. That makes Nvidia an exception among the most valuable technology companies, most of which are sending cofounders or CEOs to the event. That includes
INDUSTRY LEADER: TSMC aims to continue outperforming the industry’s growth and makes 2025 another strong growth year, chairman and CEO C.C. Wei says Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), a major chip supplier to Nvidia Corp and Apple Inc, yesterday said it aims to grow revenue by about 25 percent this year, driven by robust demand for artificial intelligence (AI) chips. That means TSMC would continue to outpace the foundry industry’s 10 percent annual growth this year based on the chipmaker’s estimate. The chipmaker expects revenue from AI-related chips to double this year, extending a three-fold increase last year. The growth would quicken over the next five years at a compound annual growth rate of 45 percent, fueled by strong demand for the high-performance computing
RSS