China Large Steelmakers Likely to See Intra-year Profit High in August

BEIJING, July 27 -- China's major steel makers have raised their ex-factory prices for August by large margins in succession recently and their profits are expected to increase sharply to see an intra-year high next month, experts predict.

    Four Chinese steel producers adjusted up their August prices by 50-500 yuan/ton Wednesday, with Shougang Group lifting its price of hot-rolled coils by 350 yuan/ton and that of cold-rolled coils by 500 yuan/ton, Laigang Group raising its price of hot-rolled coils by 100 yuan/ton, Jiangsu Shagang Group raising its rebar price by 160 yuan/ton and wire price by 150 yuan/ton, and Guangdong Shaoguan Iron & Steel Co. uplifting its wire price by 50 yuan/ton.

    China's largest steel maker Baoshan Iron & Steel Co. earlier adjusted up its prices of hot-rolled and cold-rolled steel products by 350-500 yuan/ton for August.

    Currently, the country's large steel plants such as Baosteel and Wuhan Steel have obtained full orders for steel plates but their stocks stay at a low level.

    Zhou Xizeng, an analyst with Citic Securities noted that the steel plate price failed to have prominent performance in the earlier period due to oversupply pressure. Now the price starts picking up as the demand from downstream industries is warming up, Zhou added.

    The recovery of the domestic automobile and home appliance sectors is also boosting demand for cold-rolled and hot-rolled steel products.

    May saw 72 Chinese large- and mid-size steel enterprises reverse losses for the first time this year and make profits of 1.26 billion yuan. Their profits will rise further in July and are expected to touch this year' peak in August if the market doesn't slump obviously by then, Zhou predicted.

    (Source: chinamining.org)