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Mr. David Horng, president of the Taiwanese Association, hoped
UIforwardUIforwardUIforward
EFDA, NFDA, and TFTA could move closer together and work
multilaterally to face and deal with the advent of risks and changes, which the
members of all three associations would face. Participants at the conference all
agreed that information provision was crucial, through websites, interchange of
information between members and that it would be worthwhile to explore the
possibility of providing an information service.
The business of the international conference concentrated on the latest
decisions by the European Union on anti-dumping duties on imports of Chinese
fasteners – and especially on discussing how to react to the situation if duties
are imposed on China and the possible advantages or disadvantages for
members of all three attending associations.
Summarising, the meeting host, Mr. Steven Fang (director of TFTA’s
Committee of Foreign Affairs) expressed his wholehearted appreciation to all
participants and informed them that the next meeting would be held in May
2009 in Italy.
China Steel Q1 prices cut by 22.5%
From material by Eric Liu and Laura Shih,
Fastener World Magazine
In December China Steel Corporation announced deep cuts in steel prices to the Taiwanese domestic fastener market for Quarter 1
2009. The decision was presented at a meeting with major fastener producers as “staying in the same boat” as CSC customers and
confirmed prices would fall by NT$7000 (154 euros) per ton. Fastener producers responded that the reduction was “not entirely
satisfying but was acceptable.”
The wire rod price cut fell at the mean for reductions across all steel grades, which ranged from BT$4550/t for plate to NT$7840/t for hot
rolled steel. The meeting was told that, while international steel prices had remained high, prices in China had dropped substantially. BaoSteel
prices, for example, had fallen to around US$710/ton in December compared with an estimated production cost for international plants of
US$670/t.
According to World Steel Association figures, global output of crude steel fell in October to only 100 million metric tonnes – a 12.4% decrease
compared to the same period in 2007 and a 6.9% fall on September 2008 figures. Production cuts in the CIS were reported to be as much as 36%
compared to the same period in 2007. North America cuts were estimated at 12.6%; Asia overall at 11.6%. China cut crude steel production by 6.9%
in September and 17% in October. The world’s largest steel corporation, ArcelorMittal was reported to be cutting production by 30% to 35%.
Predictions are for market supply and demand to gradually make a turnaround from the end of 2009 to the beginning of 2010.
Therefore, vice chairman T. J. Csi of T.I.F.I., profoundly called on fastener manufacturers in the meeting, “In the environment of this global
economic slump, everyone should come up with ideas to reduce wire materials and finished products stocks to reduce stock cost as much as
possible. In the meantime, we should cooperate with the technical policy of CSC, keep the distributed quota of wire rods, conserve energy, and
pay more attention to international circumstances. Go overseas if possible, try your best to sell stocks, and be active. You will perhaps run into an
unexpected result.”
In the meeting, Mr. M. H. Chen, director of CSC Operation Sales Division, repeatedly emphasised that CSC “reduces price in pain” to share in
the economic hardship of manufacturers. CSC was encountering its first loss in 29 years, he said, but was willing to cooperate with everyone to
overcome the obstacle. Mr. Chen encouraged fastener manufacturers to continue to aim for high quality and diversification in order to improve
the precision and added value of the products. For now, CSC would respond to supply and demand circumstances to appropriately cut down on
the market supply, assist in reducing downstream steel stocks, and
work to bring the steel market back on the track as soon as
possible.
Even though midstream and downstream manufacturers
recognise that there is some sincerity in CSC’s actions, the
majority still think the reduction range is not enough. Their
belief is that finished wire rod costs should be maintained at
25% low levels for reasonable profits to be achievable. However,
it seems to be “Mission Impossible” for the current economic
situation in Taiwan.
Regarding the comparison with China costs downstream
manufacturers believe that, as long as the disparity between
Taiwan and China can be held within 15%, Taiwan
manufacturers can certainly be internationally competitive.
Otherwise, facing the menacing low-price policy of Chinese
fasteners, Taiwanese manufacturers can only hope that the EU
does adopt high anti-dumping taxes on China to stimulate the Mr. M. H. Chen,
buyers from Europe and the U.S. to purchase high quality director of CSC Operation
Mr. T. J. Csi,
products, helping its fastener industry to recover from the Sales Division. vice-chairman of TIFI.
effects of the drastically withering recession.
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