China Steel Corp, Taiwan's biggest steel maker, cut its domestic steel prices for January and February shipments by 0.75 percent on average as the outlook for demand remained cautious.

"Steel demand this quarter is lower than expected,” the company said in a statement released yesterday.

The fourth quarter is a traditional peak season for the industry as more construction projects are implemented, it said.

Sales volume this quarter is expected to drop to 2.89 million tonnes, lower than the target of 2.9 million tonnes, China Steel vice president for sales Liu Jih-gang said by telephone.

"Downstream companies are still taking a wait-and-see stance as they are uncertain about demand for their products,” Liu added.

The US government is facing another showdown on its debt ceiling in February, making the global economic outlook and global steel demand uncertain, Liu said.

However, Liu said the company is likely to raise steel prices for March shipments if the confidence of downstream companies increases.

Electro-galvanized steel sheet prices are to drop by NT$500 a tonne, while prices for hot-dipped, zinc-galvanized sheets are to be lowered by NT$133 a tonne.

Prices of low carbon steel bars and rods are to decline by NT$500 a tonne, while prices for other steel rods and bars are to remain unchanged.

Liu said the company lowered the prices of carbon steel bars and rods because downstream companies making screws are facing difficulty.

Prices for hot-rolled sheets and coils are set to decrease by NT$111 a tonne, while those for cold-rolled sheets and coils are being cut by NT$273 a tonne.

However, the company kept the prices of electrical sheets, which are mainly used to manufacture home appliances, and steel plates unchanged as prices for these products are more stable, Liu said.

Shares of China Steel rose 0.99 percent yesterday, outperforming the TAIEX, which was up 0.53 percent.

Source: Taipei Times