Considering its very positive performance in terms of automotive sheet sales, Chinese steel producer Baosteel plans to expand its automotive sheet production capacity by 15 percent in the coming year, company president Ma Guoqiang has disclosed.

In the past week, Baosteel announced an overall upward adjustment to its ex-factory prices for January 2010, generating concerns over the impact of the price hike on the upcoming iron ore price talks. In response, Mr. Ma said that it was on account of the supply and demand situation that they had raised their prices. He added that, while the increased steel prices may affect the expectations of iron ore suppliers to a certain extent, this does not mean that the mills should not adjust their prices based on the market situation.

At present, Baosteel is registering rapid sales of certain of its products such as automotive sheet, and is unable to meet downstream demand even though it is operating at full capacity. Moreover, a very positive performance is also seen as regards sales of sheet for household appliances. In this context, Baosteel plans to increase its automotive sheet production capacity by 15 percent in the coming year.