Hyundai Steel to Increase Prices in Line with Rising Production Costs

17 March 2016

Hyundai Steel, a major Korean steelmaking company associated with Hyundai Motor Group, said Thursday that it has decided to raise prices of its major steel materials here starting next month to reflect a recent hike in production costs.

The prices for its hot-rolled and cold-rolled steel plates being sold in Korea will be raised by around 30,000 won ($25.14) per ton in phases over a two-month period starting in April, according to the company.

Hot-rolled steel is a key steel material, while cold-rolled steel is a high-priced material mostly used in cars and home appliances.

The planned hike is intended to reflect a rise in raw material prices that has driven up its overall production costs since late last year. The won's recent decline against the U.S. dollar added to the cost burden.

Hyundai Steel, along with market leader POSCO, has been reluctant to raise steel prices for fear that it could hurt their price competitiveness against Chinese rivals armed with excessively low-priced products.

Chinese firms, however, recently are increasing their product prices as the Beijing government is moving to restructure the steel industry by tackling an industrial glut, which experts say is giving more leeway to South Korean companies to reflect rising production costs in their prices.

A Hyundai Steel official said that the company is considering an additional price increase down the road depending on market situations.

Hyundai Steel shares got off to a strong start on Thursday, trading at 55,000 won on the Seoul bourse as of 9:22 a.m., up 3.19 percent from the previous day's close. (Yonhap)


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