China Steel raising prices to counter surging costs

China Steel Corp (中鋼), the nation’s largest steelmaker, is to raise domestic steel prices next month by 2.95 percent on average as manufacturing costs surge due to climbing raw materials costs and unfavorable foreign exchange rates, it said yesterday.

The Kaohsiung-based steel company said unfavorable conditions were unlikely to ease, given persistent hikes in the prices of coal, iron ore, nickel and other metals due to the war in Ukraine.

Transportation costs are also on the rise due to port gridlock, the company said in a statement.

Steel supply has particularly tightened in Asia, as steelmakers from Indonesia, Japan, South Korea and Turkey ship most of their products to Europe, seeking higher returns, it said.

As a result, China Steel is raising prices by between NT$500 and NT$1,200 per tonne for steel used in a wide range of categories from home construction to computers and vehicles, it said.

“The company decided to increase prices gradually to help customers weather the tough economic conditions, as they are facing reduced demand at home due to rising COVID-19 infections. Besides, a weak New Taiwan dollar and unresolved global port gridlock also create downside risks,” it said.

With the latest adjustments, China Steel said the prices of mainstream hot-rolled and cold-rolled steel products would still be lower than that of imported steel.

The move is intended to match its Asian peers, which have increased steel prices sharply, as Russia’s invasion of Ukraine has raised raw material costs, energy prices and transportation fees, it said.

Nippon Steel Corp, Japan’s biggest steelmaker, increased prices by ￥20,000 (US$158.09) per tonne for delivery during the April-to-September period, China Steel said.

Nippon Steel also raised prices of steel sheets used in construction and electronics by ￥10,000 per tonne for next month’s delivery spot contracts, it said.

The latest price quotes from China’s Baowu Steel Group Croup Ltd (寶武鋼鐵), Angang Steel Co Ltd (鞍山鋼鐵) and Formosa Ha Tinh Steel Corp (河靜鋼) are also at high levels, it added.