China Steel Corp (中鋼), the largest steelmaker in Taiwan, yesterday cut domestic steel prices by up to NT$2,000 per tonne for domestic deliveries next month and next quarter, as a global steel industry recovery fell short of expectations, while customers continue to deal with excess inventory.

The Kaohsiung-based steelmaker said that world steelmakers received rush orders in the first quarter, but that growth momentum was unable to persist as demand from China was not as strong as expected after it emerged from strict COVID-19 rules earlier this year.

China is the world’s biggest steel consumer and producer.

Faltering demand in the US and Europe was also a factor, the company said.

“The global steel industry recovered at a slower pace than expected in the second quarter, causing an excessive drop in steel prices,” China Steel said in a statement. “The company’s latest pricing factored in downstream customers’ inventory impairment losses, aiming to help them enhance their price competitiveness.”

China Steel said it would cut steel prices for a second straight month by between NT$1,000 and NT$1,500 per tonne for domestic delivery next month, with the steepest price cuts for cold-rolled plates.

For the whole of next quarter, the price cuts would be even deeper, by between NT$1,500 and NT$2,000 per tonne, it said.

Prices of rod lines, regular steel plates, hot-rolled steel plates and coils, as well as high-end cold-rolled coils, would fall by NT$2,000 per tonne. The price of cold-rolled coils used in vehicles would drop by NT$1,500 per tonne.