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Baosteel keeps prices unchanged

BAOSHAN Iron & Steel Co has maintained prices of major products for June, industry sources said yesterday, reflecting a market outlook that steel prices may stop falling.

The Shanghai-based company, China's largest listed steel maker, had cut prices for April and May in tandem with lower market prices amid an oversupply.

For June, prices for hot-rolled steel products will remain at May's level of 3,292 yuan (US$482.4) per ton and cold-rolled steel products at 3,826 yuan per ton.

Decline eases

"The June pricing policy means Baosteel has an intention to stabilize the market and it expects the market may turn better in the future," said Hu Yanping, an analyst at Umetal Research Center in Beijing, adding the decline in steel prices has eased in the past week.

Domestic prices have been declining after a short-lived recovery early in the year because mills, mainly smaller ones, increased production in anticipation that stimulus measures would boost demand. But sluggish demand and overcapacity left the whole industry suffering a wider loss in March.

Still, Baosteel lowered prices for products such as aluminum-zinc alloy-coated steel and heavy plates for June.

Separately, Hebei Province, China's largest steel-making province, on Friday approved a plan to cut 20 million tons of outdated steel capacity in three years and to boost efficiency and pollution control in the sector, according to the local government.

Steel output in the northern province, home to a large number of private mills, totalled 116 million tons last year, or more than a fifth of China's total.

Tian Zhiping, vice president of state-owned Hebei Iron & Steel Group, the province's No. 1, said the capacity reduction plan targets smaller private mills. "It's only a broad directive so we cannot estimate how our firm would benefit," he said.


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