Steel giant POSCO aims to increase hot rolled coil (HRC) prices for Apr’22 sales on soaring raw material costs. The import price of Australian iron ore of Fe62% from China has risen sharply to $150-160/t CFR. However, it is still below $220/t levels seen in CY’21. But, the major problem is that coking coal prices are skyrocketing, putting a huge pressure on costs.
For instance, Australian coking coal prices touched around $660/t levels during the second week of March compared to $400/t at the beginning of CY’22. Input costs have crossed more than $712/t during second week of March, from around $500/t seen in Jul’21, which had been the highest level at that juncture.
With increase in raw material costs, imported HRC (SS 400) offers from China have also risen to $920/t CFR levels for May’22 shipments.
It is anticipated that with increase in international oil prices and the consequent rise in logistics costs, the cost burden of steelmaking raw material will not decrease in H1CY’22. Therefore, POSCO and Hyundai Steel might opt for additional hikes up to double digits in April, despite sluggish domestic demand.
Note: This article has been published in accordance with an article exchange argeement between SteelDaily and SteelMint.
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