According to this week's announcements, the delivery price of 670,000 won/t ($485) was 20,000 won (USD 14) higher than last month. This is the first increase in South Korean rebar delivery prices since January.
Hyundai Steel decided to extend planned maintenance work at its Incheon plant until July. These works are considered as part of their strategy to adjust production capacity. Dongkuk Steel, on the other hand, aims to reduce production costs by operating its electric furnace plant on night shifts.
Steel companies say that production cuts and discount policies will continue as distribution prices are still below cost. Direct sales with major construction companies and intermediate distributors continue to be the determining factor in the market.
"We will continue to maintain production restrictions, considering that demand growth may be difficult due to the summer lull in the construction sector," steel industry officials said. However, limited activities of intermediate distributors and intense competition make price stabilization difficult.
Hyundai Steel has lifted its discount policy, while Dongkuk Steel is preparing to maintain its night production policy. Steel companies are planning ahead to stabilize distribution prices and normalize the market.
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