Tuesday, July 25, 2006

Economists see another steel price increase in US

According to the latest Kiplinger Letter a Washington DC economic forecaster steel prices could rise in August and remain high well into next year. The newsletter said "Typically they decline in the fall, but not this time around. Growing demand in the US, China, India and Europe are to blame." China, India and other developing nations have consumed millions of tons of metals to fuel their economies, putting pressure on world prices.

According to Kiplinger metal product manufacturers should expect a $30 per ton across the board price increase in about a month, which would put the price of hot rolled steel at about $660 per ton and cold rolled steel at about $790 per ton.

According to Mr Robert Schenosky an industry analyst with Jefferies & Co in New York some companies have already absorbed a $20 per ton increase in the price of steel in recent months, and a similar increase could be coming. He said "I am not sure it will be in August, but it could be sometime this fall. I think that you could see one more price increase this year, partly because steel imports have remained down and broadly speaking, demand for steel has remained firm."

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