wiredinUSA September 2012

INDEX

Cable contracts

China steel price fall

POSCO cuts prices

Cable expansion

One of China’s largest wire and cable manufacturing companies, Hu An Cable Holdings Ltd, has secured contracts worth S$20.8 million (around $16.6 million) from China Power Investment Corporation. The group won 25 out of 29 projects put up for tender by the producer, said to be one of China’s top five power generation companies. The contracts, secured by a wholly owned subsidiary, Wuxi Hu An Wire And Cable Co Ltd, are for the delivery of power cables to 25 wind, solar and hydroelectric power plants across China, including the 20MWp grid-connected photovoltaic power plant in Shanshan, Xinjiang and the 30 th wind farm project in Changling, Jilin. The group expects to deliver over 80 percent of the contract value during 2012 and the balance in 2013.

Due to current capacity constraints, Kelani Cables PLC is to extend its existing facility at Kelaniya. “We have identified a 277 perch land which is adjacent to our factory at Kelaniya for expansion,” Mahinda Saranapala, CEO Kelani Cables told the Business Times. He added that the company has already identified the machinery required for the new facility, once the expansion is complete. The company saw its net profit increase by 123 percent last year. “During the year we faced volatility in copper prices in international markets and operational challenges in thedomesticmarket that had an overall adverse impact of our bottom line, such as the escalation of fuel prices, foreign exchange fluctuations, increase in electricity prices and also increased competition,” said Mr Saranapala. Export orders continue to show growth. “In addition to our existing export markets in the Maldives, Bangladesh, India and Japanduring the2011/12 financial year, we initiated negotiations to enter the lucrative Australian household wire market,” Mr Saranapala said, adding that Kelani Cables had also sent trial orders to South Africa during the year.

POSCO Specialty Steel is reported to have cut the domestic prices of austenitic stainless wire rod and bar for August 2012 deliveries in response to a decline in nickel prices, which have decreased below $16,000 per tonne since the middle of July 2012. Meanwhile, data released by the Korea Iron and Steel Association revels that South Korea’s production of bars has fallen by two percent (month-on-month) to 222,400 tons.

Industry analysts view recent announcements of ex-factory price reductions by several Chinese steel producers as possible evidence of an upward turn in the fortunes of the domestic steel industry. Shagang, the largest privately owned steel mill in China, has lowered its prices for wire rodby $18.87 per ton. As a result, Shagang’s price for 6.5mm HRB 235 wire rod has fallen to $572 per ton. Baoshan Iron and Steel Co, China’s third largest steel mill by production capacity, has reduced its ex-factory prices for September orders - the third consecutive month that the company has reduced the price of both hot- and cold-rolled products. Baosteel reduced its flat rolled products prices by between 300 yuan and 500 yuan per ton in its July and August price adjustments, compared to its September cut of between 80 yuan and 180 yuan. According to figures from SteelHome, Chinesemarket prices of rebar andwire rod declined by about 50 yuan per ton since the beginning of August, considerably less than the average monthly decrease of over 300 yuan per ton seen in July.

ASIA / AFRICA NEWS

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wiredInUSA - September 2012

wiredInUSA - September 2012

37