JFE Steel to Hike Hot Coil and Plate Export Price by 5-10% for April-June

JFE Steel tries to increase the export price of hot rolled steel products including hot rolled coil and plate by 5-10% for April-June shipment from January-March. The firm tries to improve the profitability under higher cost for iron ore and raw materials when the firm expects the tight supply continues with lower supply ability in Asia along with firm domestic demand. The firm started the negotiation with some buyers and tries to conclude the price hike talk in February. POSCO of South Korea plans maintenance for no.2 hot strip mill at Gwangyang works in the year and will reduce hot coil supply by near 1 million tonnes shifting to high end products including cold rolled and coated steel. JFE Steel’s vice president Tsutomu Yajima said the Asian market keeps tight in April-June with firm demand in India, Southeast Asia and Thailand despite of some concern for aggressive output increase in China when JFE Steel receives strong supply request from South Korean rerollers. Shipbuilding demand keeps strong when shipbuilders in Japan, South Korea and China keep more than 3 years of order backlog. JFE Steel said the firm cannot meet the higher demand even with expansion of the capacity at the firm and the partner of Dongkuk Steel of South Korea. The firm also has limited steel source for export when domestic users keep the high level activity. Japanese steel industry expects the raw materials and freight cost will increase by 200 billion yen in fiscal 2007 starting April 2007 from fiscal 2006 after 600 billion yen of higher cost in fiscal 2006 from fiscal 2005.