Japanese Makers Increases Steel Plate Price to South Korea

Steel plate export price of Japanese integrated steel makers is increasing. JFE Steel raised the export price by US$ 20-30 to FOB US$ 650-660 per tonne for South Korean shipbuilders for the last half of fiscal 2007 ending March 2008. Other makers seemed to raise extra charge such for high-tension products by about US$ 40 per tonne. Maker source said they contracted with Chinese shipbuilders at FOB US$ 700 for shipment in October-December. They will also raise the export price in the first half of fiscal 2008 with a prospect iron ore and coal costs would surge up.Steel plate supply is tight due to strong demand for shipbuilding, energy industry, construction machine and industrial machine. In South Korea, steel plate demand for shipbuilding is expected to increase by 2 million tonnes to 7.52 million tonnes in 2007 from 2006. South Korean shipbuilders are expanding the capacity as well as Chinese shipbuilders. Consequently Japanese steel plate export to South Korea and China is expected to increase next year.Nippon Steel, JFE Steel, Sumitomo Metal Industry and Kobe Steel are expanding the production capacity by enhancement of heat furnaces. However, they cannot meet the strong demand yet since domestic demand also keeps strong. South Korean steel makers, POSCO, Hyundai Steel and Dongkuk Steel Mill, announced the capacity expansion. But their operation will start after 2009. The tight supply is expected to continue for a while.