China Steel Corp the nation’s largest steelmaker, yesterday said it would raise prices by 3.7 percent per tonne on average for deliveries in December, due to increases in raw material costs.

The Kaohsiung-based steelmaker said it would raise the prices of its four major products by NT$600 (US$19) per tonne, including hot-rolled and cold-rolled sheets.

Coking coal is definitely the most important factor determining global steel prices, a CSC official said by telephone.

The price of coking coal rose to more than US$220 per tonne this month, compared with US$90 per tonne at the beginning of July, according to a CSC statement released yesterday.

“Production costs have surged by US$80 per tonne recently because of rising raw material costs,” the company said in the statement.

The official, who declined to be named, said that the company absorbed nearly 75 percent of the costs and only raised the prices by less than US$20 per tonne.

“We hope to help downstream companies retain their price competitiveness and have enough time to adjust to price hikes,” the official said, adding that coking coal prices might not return to normal levels soon.

Most of the company’s peers in Asia are planning to raise steel prices significantly in the fourth quarter, CSC’s statement showed.

Japanese steelmakers are likely to raise their prices by more than US$100 per tonne this quarter, while major Chinese steel mills, including Shanghai Baosteel Group Corp have hiked prices for four consecutive months.

CSC said it is cautiously optimistic about its sales outlook amid recovering demand in the global market.

The global demand for steel products is forecast to grow 0.2 percent this year and 0.5 percent next year, the World Steel Association has forecast.

CSC’s shipments in the fourth quarter would reach 3.28 million tonnes, meeting the company’s expectations, the official said.

The company said it plans to manufacture more products this quarter in a bid to build up inventories in preparation for regular maintenance at some of its factories next year.

CSC shares gained 1.14 percent to close at NT$22.25 before the announcement of the new prices, compared with the TAIEX’s 0.67 percent increase.

 

Source : taipeitimes.com

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