SEOUL (Reuters) - South Korea's POSCO <005490.KS> cut its 2013 sales target by 3 percent on Thursday as the world's fifth largest steelmaker struggles to win orders away from Asian rivals also scrambling in an oversupplied market.
POSCO posted its steepest quarterly fall in operating profits so far this year for the July-September period, hit by declining sales and a prolonged slump in steel prices. Profits fell by nearly half to a lower-than-forecast 443 billion won (259.3 million pounds).
Sales also fell in the third quarter. POSCO said it now expected sales for the year to reach 31 trillion won, down from a previous forecast of 32 trillion won.
The economic slowdown in the world's largest steel consumer China and the financial crisis in Europe have weakened steel demand and prices, hitting hard Asian steelmakers like POSCO and Chinese rival Baosteel <600019.SS>.
POSCO said that steel prices in China were likely to "moderately bounce up" before the end of the year as inventories declined. It did not give further details.
POSCO has struggled to win over overseas clients, as a weaker yen helped boost export demand for Japanese steel makers like Nippon Steel & Sumitomo Metal Corp <5401.T> and JFE Holdings Inc <5411.T>, which have ramped up production.
At home, where POSCO sold nearly 60 percent of its output in the third quarter, the company is still losing market share to smaller rival Hyundai Steel <004020.KS>, which is backed by automaker Hyundai Motor. Hyundai Steel also fired up a third blast furnace in September.
The average selling price for POSCO's main carbon steel products declined 12 percent to 773,000 won per tonne in the third quarter from a year earlier, the company said.
POSCO shares ended up 0.5 percent prior to the results, in line with a 0.5 percent gain in the broader market <.KS11>.
The stock has lost 8.3 percent so far this year, lagging the market's 2 percent rise.(Reporting by Hyunjoo Jin; Editing by Miral Fahmy)