China Steel raises prices to counter rising costs

China Steel Corp (中鋼), the country's largest steelmaker, is set to raise domestic steel prices by an average of 2.95 percent next month as production costs rise on rising raw material costs and an unfavorable exchange rate, the company said yesterday.

The Kaohsiung-based steel company said the unfavorable conditions were unlikely to ease, given the continued rise in prices for coal, iron ore, nickel and other metals due to the war in Ukraine.

Transportation costs are also rising due to congestion at the port, the company said.

Steel shipments have been particularly reduced in Asia as steelmakers from Indonesia, Japan, South Korea and Turkey ship most of their production to Europe in search of higher profits, the report said.

As a result, China Steel is raising prices by NT$500 to NT$1,200 per tonne of steel used in a wide range of categories from residential construction to computers and automobiles, the report said.

“The company has decided to gradually raise prices to help customers weather tough economic conditions as they face lower demand at home due to rising COVID-19 cases. In addition, the weak New Taiwan Dollar and the unresolved global deadlock in ports also pose downside risks.

With the latest adjustments, China Steel said that prices for bulk hot-rolled and cold-rolled steel products will continue to be lower than imported steel.

The move is meant to be in line with Asian counterparts that have pushed up steel prices sharply as Russia's military action in Ukraine has pushed up raw material costs, energy prices and transportation costs, the report said.

Nippon Steel Corp, Japan's largest steelmaker, raised prices by 20,000 yen ($158.09) a tonne for delivery between April and September, China Steel said.

Nippon Steel also raised prices for flat steel used in construction and electronics by 10,000 yen per tonne for spot contracts for next month's delivery.

The latest price quotes of Chinese Baowu Steel Group Group Ltd (寶武鋼鐵), Angang Steel Co Ltd (鞍山鋼鐵) and Formosa Ha Tinh Steel Corp (河靜鋼) are also at a high level.

According to China Steel's new prices, hot-rolled sheet and hot-rolled coil prices will increase by NT$1,200 per ton. The price of cold-rolled coil will rise by NT$1,000/tonne, while the price of galvanized steel coil used in construction and firing finishing will increase by NT$1,200/tonne.

The price of galvanized steel used in household appliances and computers will rise by NT$1,200/ton, and electrical steel coil by NT$500/ton.

Source: Taipei Times