Asian steel sector 'stable;' China, consolidation main drivers - Moody's |
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Thu, 21 Jun 2007 05:59
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BEIJING (XFN-ASIA) - Moody's Investors Service said it is maintaining a 'stable' rating outlook for Asian steel producers with market conditions in China and global consolidation trends the key themes for the sector.'Although near term fundamentals remain supportive for the sector, the potential for event risk is significant due to the effects of an ongoing global consolidation trend, particularly in Asia, where production has long been highly fragmented,' Moody's said.The report examines the outlook for ratings and consolidation trends, and input costs for the steel industry in Asia, excluding Japan.'China - the world's largest steel consumer - remains the main driver for the industry's price and demand dynamics. Overcapacity led to considerable growth in exports in early 2007, although prices have held up reasonably well,' Moody's added.It said China's objective has been to manage down its steel production and over-capacity, and while it has made some progress in this area, more can be done.'The recent initiatives to curb exports should be supportive for the industry overall,' Moody's said.andrew.pasek@xinhuafinance.com
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