POSCO has confirmed that it cut prices for its stainless steel products by 15-20 pct in response to weak global steel prices.

This is the second price cut so far this year, suggesting that the steel industry is in a downturn.

Beginning from today's shipments, prices of stainless steel products have been slashed by 260,000 – 400,000 won per ton, the nation's largest steel maker said.

The price of 400 series HRC stainless steel is down 20 percent to 1.31 million won per ton, and that of 300 series stainless steel plate is cut to 2.33 million won

'We have reasons to cut prices – a weak global steel market and falling prices of nickel. Any real impact from the price cuts (on our results) will be minimal as many of the products are already being sold at discounts,' Internet news provider edaily cited a POSCO official as saying.

The action followed Baoshan Iron & Steel Co Ltd's announcement last month that it will cut prices on some of its steel products by at least 10 pct for the first quarter of 2006 from the level in the fourth quarter of 2005.

According to a report by the China Securities Journal citing a state think tank report earlier today, China's steel industry is expected to be in oversupply in 2006 with a surplus of 116.51 mln tons as demand growth slows.