ARCELORMITTAl SA has come out in full defence of its decision to increase steel prices — twice — since the industry received protection against cheap Chinese imports.
SA’s largest steel producer said on Wednesday that the price hikes were in line with global market movements, and that it had not backtracked on its commitment to drop import-parity pricing in exchange for antidumping duties.
Furthermore, the company stressed that the increases, which will kick in next month, were necessary for the sustainability of the steel industry.
"We have not deviated from the principle of a fair pricing model for steel," ArcelorMittal SA corporate affairs manager Themba Nkosi said on Wednesday.
"However, we won’t price ourselves out of the market because we have a tariff ."
The price of the raw material steel basket, made up of iron ore, scrap and coking coal has increased more than 20% in the past month due to reduced capacity in China.
The recovery in the price from multiyear lows had prompted a reaction from most global steel makers, wh ich, like ArcelorMittal SA, have suffered losses due to the supply glut.
Luxembourg parent ArcelorMittal had recently increased the price of flat steel in Europe by ¤33, said Adam Knight, marketing manager for pricing at the local subsidiary.
"Domestic steel prices in the US and in India have also increased," he said. On April 1, the average increase in flat steel products in SA will range from 1% to 11%.
The upper range is close to the 10% import tariff the government had imposed on a number of steel products in December.
Long steel products will see average price increases of between 2% and 8%.
ArcelorMittal SA also raised prices in January.
There had been no significant decline in the number of imported steel products entering SA, despite protection, ArcelorMittal SA market intelligence manager Hannes Basson said.
"We thought that there would be a bigger change, but there is still a number of imports still," he said.
The government has so far approved import duties on eight steel products.
The company is still engaging with domestic import authorities for the outcome of the final two products — hot-rolled coil and other bars and rods.
Steel coils. Picture: BLOOMBERG
ARCELORMITTAl SA has come out in full defence of its decision to increase steel prices — twice — since the industry received protection against cheap Chinese imports.
SA’s largest steel producer said on Wednesday that the price hikes were in line with global market movements, and that it had not backtracked on its commitment to drop import-parity pricing in exchange for antidumping duties.
Furthermore, the company stressed that the increases, which will kick in next month, were necessary for the sustainability of the steel industry.
"We have not deviated from the principle of a fair pricing model for steel," ArcelorMittal SA corporate affairs manager Themba Nkosi said on Wednesday.
"However, we won’t price ourselves out of the market because we have a tariff ."
The price of the raw material steel basket, made up of iron ore, scrap and coking coal has increased more than 20% in the past month due to reduced capacity in China.
The recovery in the price from multiyear lows had prompted a reaction from most global steel makers, wh ich, like ArcelorMittal SA, have suffered losses due to the supply glut.
Luxembourg parent ArcelorMittal had recently increased the price of flat steel in Europe by ¤33, said Adam Knight, marketing manager for pricing at the local subsidiary.
"Domestic steel prices in the US and in India have also increased," he said. On April 1, the average increase in flat steel products in SA will range from 1% to 11%.
The upper range is close to the 10% import tariff the government had imposed on a number of steel products in December.
Long steel products will see average price increases of between 2% and 8%.
ArcelorMittal SA also raised prices in January.
There had been no significant decline in the number of imported steel products entering SA, despite protection, ArcelorMittal SA market intelligence manager Hannes Basson said.
"We thought that there would be a bigger change, but there is still a number of imports still," he said.
The government has so far approved import duties on eight steel products.
The company is still engaging with domestic import authorities for the outcome of the final two products — hot-rolled coil and other bars and rods.
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