Nippon Steel Launches Plate Hike by 3,000 y/t for May Contract

Nippon Steel started price hike announcement of steel plate by 3,000 yen per tonne effective for May contracts or June shipment against the distributors and the users. This is the first price hike of steel plate by Nippon Steel since March 2011. The firm feels necessity to improve the price to the sustainable level though the firm continues cost reduction efforts. The firm also tries to implement price hike of steel plate and square steel those which are used for construction applications such as steel frames or bridges. The firm eyes the additional hike in June or later.

Iron ore spot price currently increased to FOB US$ 141 per tonne, exported from Australia to China, from US$ 115 at the end of 2011. China’s iron ore import increased by 6% year-on-year for January-March 2012. Ferrous scrap market price is also hitting bottom.

To reflect material cost upsurges, overseas steel makers are starting price hike of steel plate. Bao Steel of China stopped discount of steel plate for May. POSCO and Dongkuk Steel of South Korea are currently narrowing the discount rate. Steel plate market price in East Asia has improved by US$ 30-50 per tonne since January. The recent price is surging by 200 yuan to 4,500 yuan per tonne in Shanghai from the beginning of this year. Hyundai Steel and Dongkuk Steel raised their offer prices to Japan by 3,000 yen per tonne for May shipment.

The demand maintains weak for shipbuilding while firm for construction machines, industrial machines, buildings and energy related applications. Nippon Steel has reduced the output along with the demand downturn for shipbuilding since January.