Despite facing stiff competition from cheaper products offered by rivals in China and Japan, POSCO and Hyundai Steel Co. plan to raise hot-rolled steel plate prices to approximately 900,000 won ($672.8) per ton this month, marking the highest level since October 2023. This follows a 2.5% price hike in January. Since hot-rolled steel sheets are basic materials in the production of many other products, including cold-rolled and electrical steel sheets, such increases have increased overall steel prices.
Hyundai and Dongkuk Steel Mill Co. also intend to raise prices of H beams, primarily utilized in construction, by around 50,000 won per ton this month, following similar increases in January. Despite challenging conditions in the construction industry, industry sources note that these adjustments were deemed necessary.
While POSCO acknowledges that its first-quarter earnings are unlikely to see significant improvement due to persistent cost pressures, it emphasizes that reflecting the impact of rising costs will take time.
In the latter half of the previous year, South Korean steelmakers refrained from increasing prices to protect market shares, facing stiff competition from Chinese and Japanese rivals offering products at prices approximately 10% lower than those in the local market. Last year, South Korea imported 8.7 million tons of steel products from China and 5.6 million tons from Japan, marking the highest import levels since 2017. Consequently, the anticipated price hikes by POSCO and other domestic steel producers may lead local customers to increasingly explore imported steel options, according to industry sources in Seoul. An official from a South Korean shipbuilder highlighted that, in terms of quality, there is little difference among domestic, Chinese, and Japanese steel, indicating a rapid shift in the local steel industry from a seller's market to a buyer's market.
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