Daido Steel Raises SC Steel Price by 10,000 Y/T in April

Daido Steel raises the selling price of all structural steel products, including carbon steel for machine structural use, chrome molybdenum steel and ball-bearing steel, by 10,000 yen per tonne against all users, distributors and contract users, effective for shipment in April. The firm passes increasing costs such for ferrous scrap, ferroalloy and energy cost on the selling price. The firm increased SC steel selling price for the first time since autumn 2005. The hike might impact distributors’ profitability when SC steel price is increasing for contract users while weakening for distributors. Daido Steel prospects SC steel demand could maintain steady for automobile, construction machinery and industrial machine and increase by 4-5% per year in 2007 from previous year. On the other hand, the firm’s profits are impacted by cost expansion such for ferrous scrap. The firm’s ferrous scrap purchasing price is recently around 31,000 yen per tonne, up by about 35% from the same period of 2006. Moreover SC steel market price in Japan is cheaper than Europe and U.S.A. The firm needs the price hike to the level enough for reproduction with secure quality and stable supply.