Baosteel sees weak market in H2
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Baosteel Group Corp said although conditions in the steel market may change, it would remain weak overall in the second half of the year, Vice Chairman Liu Guosheng said Tuesday.
The Shanghai-based company mainly produces steel products used in autos, home appliances and shipbuilding. However, auto output has continued to expand at a slower pace this year as the effects of the stimulus measures to boost auto sales are fading. In June, auto sales rose 14 percent to 1.13 million units, compared with increases of 34 percent in April and 25 percent in May.
Even as Baosteel cut steel prices for July by as much as 17 percent on weak demand, it may face higher costs because iron ore miners are seeking price increases for the third quarter.
Baosteel highly depends on supplies from Australian miners as its steel products required high-grade iron ore, a major ingredient in steel making.
Liu also said the steel maker intends to actively expand abroad but he declined to elaborate.
He said there are currently no specific overseas investments but the company will maintain the proportion of exports at 10 percent of its annual production.
