Seoul: Posco, the world’s No.3 and South Korea’s No.1 steelmaker, is likely to keep domestic prices of its key steel products unchanged in the first quarter of next year from this quarter, company sources said.
“Steel prices are likely to stay at the current levels. It would be difficult for us to raise prices,” one of the sources said on Friday, citing sluggish demand and market weakness.
The sources declined to be named as they were not authorised to speak to the media. Posco officials declined comment.
Some of Posco’s rivals, however, are raising prices for early next year.
South Korea’s No.2 steelmaker Hyundai Steel Co said on Thursday that it would increase export prices of major products for January and February. The rise would continue as iron ore imports for the first-quarter were expected to cost 7-8% more, at least.
China’s third-largest steel mill Wuhan Iron & Steel Co Ltd will increase steel product prices by 100-150 yuan per tonne ($15-22.50) in January, indicating a positive outlook for demand.
Key iron ore indexes are underlining the recent bullish market tone. The Steel Index 62% iron ore benchmark gained 30 cents to close at $168.8 per tonne cost & freight delivered to China on Thursday, its highest level since 13 May.
Rio Tinto Plc, the world’s second-largest iron ore miner, would raise iron ore contract prices for Chinese steel mills by 7.6% in the first quarter of 2011, trading sources said last week, a move likely to be followed by other major miners Vale SA and BHP Billiton Plc.