Tuesday, April 22, 2008

Nippon Steel to seek 40 pct price hike

Japan's largest steel maker Nippon Steel Corp. will seek a 40 percent hike in prices for its mainstay steel products from automakers and other customers due to soaring materials costs, the Nikkei reported on Tuesday, citing company president Shoji Muneoka.
Other major steelmakers will likely follow suit, but makers of cars, machinery and electronics products are expected to oppose the request, the business daily said.
Nippon Steel "will have to propose a price hike of 30,000 yen" ($290.75) for the year to March 2009, the Nikkei quoted Muneoka as saying.
Steel products currently average some 80,000 yen per ton, the report said.
The leading steelmaker aims to raise prices starting with April shipments.
Nippon Steel had earlier sought a hike of roughly 20,000 yen per ton, assuming that high materials prices would result in a 2 trillion yen increase in costs to the steel industry.
But with coal and other materials becoming more expensive, the company now expects the cost increase to come to slightly more than 3 trillion yen to the steel industry, the Nikkei said.
If steel prices go up 30,000 yen per ton, cost increases will likely reach 460 billion yen a year in the auto industry and 200 billion yen in shipbuilding.

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