China's Wuhan Steel: To benefit from steel dumping tariffs

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Last updated at: (Beijing Time) Wednesday, January 14, 2004

China's Wuhan Steel: To benefit from steel dumping tariffs

Wuhan Steel Processing Co. said Wednesday that China's anti-dumping tariff on cold-rolled steel products from South Korea, Taiwan, Russia, Ukraine, and Kazakhstan would help its business.

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Wuhan Steel Processing Co. said Wednesday that China's anti-dumping tariff on cold-rolled steel products from South Korea, Taiwan, Russia, Ukraine, and Kazakhstan would help its business.

China's Ministry of Commerce said on its Web site late Tuesday it had decided to slap tariffs on cold-rolled steel from those countries.

Wuhan Steel, a unit of a major steel group in China, said in an announcement posted in the Shanghai Securities News that cold-rolled steel products form part of its core business, accounting for 48% of its sales in the first half of last year.

The commerce ministry's decision would eliminate the impact of dumping from those countries and help restore "normal market order," Wuhan Steel said.

It added that it lodged the anti-dumping complaints, along with China's largest steelmaker Shanghai Baosteel Group, and Anshan Iron & Steel Group, which led to the tariffs.

The tariffs are likely to help keep steel prices in China high in the near future, said officials at Baoshan Iron & Steel Co. , the listed arm of Baosteel, and Angang New Steel Co. , the listed unit of Anshan Steel.

But the Angang official said prices could start to fall in the second half despite the added protection, as many local steelmakers have invested heavily in expanding their production capacity. Angang, however, expects profit growth this year to be similar to last year's, the official said. He didn't say what last year's growth was.

The Baoshan official said the impact wouldn't be so significant as the tariffs apply only to products from certain regions.

The tariff news initially helped steel stocks, but they started falling later on overall market weakness.

Shortly before the midday break, Baoshan Iron & Steel's A shares were up 0.3% at 7.79 yuan after rising as much as 1.5% earlier in the session. Wuhan Steel Processing's A shares lost 2.4% to 7.46 yuan after gaining as much as 2.1% earlier, and Angang's A shares lost 0.3% to 6.88 yuan, after rising 1%.

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