South Korean Steel Makers to Raise Rebar Price by 30,000 won/t

South Koran major electric furnace steel makers including Hyundai Steel and Dongkuk Steel currently offered rebar price hike by 30,000 won (approximately 2,100 yen) per tonne for January shipment. The selling price to general contractors is expected to reach 840,000 won per tonne for the size with 10 millimeters diameter. General contractors are resisting against the hike offers. Thus the rebar price conference, in which governmental people join, is likely to accommodate the price finally.

South Korean electric furnaces decided the price hike offers when their purchase price of ferrous scrap has increased by around 50,000 won per tonne since mid-late November.

Hyundai Steel and Dongkuk Steel announced each company implements the hike effective for the shipment on and after January 2. Hwan Yung Steel announced the price hike effective on and after January 3. YK Steel announced the hike starting on January 4. Major general contractors are strongly resisting the price hike due to construction market deterioration. Some require the price cut against the steel makers.

Steel makers had shown the price hike intentions by 50,000 won effective for August 2011 shipment. General contractors refused the acceptance and each steel maker stopped the shipment from September 17. Finally the governmental delegates mediated the hike by 40,000 won until October shipment.

For the next, steel makers announced the price hike by 30,000 won for November shipment. The governmental committee accommodated the hike range and, as a result, the price decreased by 10,000 won in November and by 20,000 won in December. Some of electric furnaces posted operating loss for October-December 2011 due to low selling price.