Steel Price Likely Up 15 Pct in Q1

VIVAnews - PT Krakatau Steel estimates 10 to 15 percent increase in steel price in the first quarter of 2010.

“Market price would go up within the first three months,” Krakatau Steel Marketing Director Irvan K Hakim said at the office of State-Owned Enterprises Ministry on Jalan Medan Merdeka Selatan, Jakarta on Tuesday, January 5.

Hakim also said the steel price for commercial steel plate products is currently around Rp 6,800 per kilogram (kg). The price excludes value-added tax.

He went on by saying that the escalation of steel price is in line with international increase triggered by the rise of iron ore price. The foreseen escalation of world crude oil price has also triggered the increase.

“The demand would go up in 2010 as well as the production costs. Therefore, the price of steel would adjust,” he said.

Several international analysts predict the price of world steel would start inclining in mid-January 2010 until the third quarter of 2010.

The escalation has been actually seen coming considering the high demand for steel in the next-five-year contract. Every year, most steel buyers have predicted the price since April because steel prices are flatly determined for a year.

Due to the rise in steel price, companies are trying to enhance the capacity of steel production from the current amount of 3-3.5 million tons. One of the options taken was the development of joint companies which are estimated to produce up to 3 million tons.

“The process of joint company negotiation will keep going. If it reaches a deal, KS (Krakatau Steel) production capacity would be up to 6.5 million tons,” he said.

Currently, China is still taking on the world’s steel market share of about 50 percent or 600-650 million tons out of the total 1.25 billion tons of world needs.

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Translated by: Nataya Ermanti

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29 Maret 2024