It is reported that Taiwan's China Steel Corporation (CSC) will cut its production capacity by 20% in December to cope with the sluggish global steel market.

Moreover, it’s predicted that the downstream producers including Yieh Phui, Sheng Yu Steel Co. and Kao Hsing Chang Iron & Steel Corp. will follow CSC to cut production.

The global steel industry is encountering slowing sales due to the European sovereign debt crisis, flooding in Thailand and oversupply in China.

It’s known that the declining demand is depriving Taiwanese downstream steel products makers; thus, they have asked CSC to reduce wholesale prices of its major product shipped in January and February 2012.

CSC predicts to have orders to fill only 80% of capacity in December despite of good performance in October and November in terms of order acquisition,