China Steel to Tap Taiwan's Stainless-steel Market

China Steel Corporation (CSC), Taiwan's largest integrated producer of steel products, will tap the NT$100-billion a year domestic stainless-steel market.

CSC will produce stainless steel through its affiliate—Dragon Steel Corporation—to become Asia's all-round producer of carbon steel and stainless steel. Dragon's electric-arc steel-melting facility has maximum capacity of 1.3 million metric tons of steel slabs, or as much as 800,000 metric tons of stainless steel yearly after retrofitting, which is triple that of Tang Eng's.

CSC's entry into the stainless steel segment is stirring the local market that is dominated by stainless-steel makers as Yieh United Steel Corp. of the E United Group, Tang Eng Iron Works Ltd., Walsin Lihwa Group and Gloria Material Technology Corp.

CSC says it is driven to produce stainless steel and specialty steel for the average price for specialty alloy steel is eight to 10-fold that of carbon steel, with the diversification to help CSC build a more integrated production line and raise overall value.

But an executive of Yieh United complains that CSC's move will upset Asia's stainless-steel market; while Walsin Lihwa warns that oversupply of stainless steel globally makes CSC's decision questionable and likely to be challenged in the long-term.



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