Nippon Steel Offers 15,000 yen/t Sheet Hike for Domestic Appliances

Nippon Steel started additional price negotiation with Japanese makers of appliances and office equipments offering 15,000 yen per tonne hike for sheet steel for October shipment. The firm tries to get additional increase to cover higher cost for raw materials when the firm cannot absorb the cost only by own effort though the firm already won 20,000-25,000 yen hike for April shipment. The firm also started study for additional hike for domestic distributors and rerollers. The firm already offered US$ 250-300 per tonne of hike for offshore transplants of Japanese appliances makers when the market price reached US$ 1,000 per tonne for hot rolled coil, US$ 1,100 for cold coil and US$ 1,200 for hot dip galvanizing steel in Asia. The firm increased the selling price by 20,000 yen per tonne in April and by 10,000 yen in July for distributors and rerollers to cover higher raw materials cost. However, Japanese steel industry’s cost of raw materials, energy and freight is expected to increase by 3.5 trillion yen for the year ending March 2009 from previous year, which represents around 35,000 yen per tonne of cost up for the steel products. The firm now reviews the market condition when steel demand decreases in the building materials market, which is main market for distributors and rerollers.