Baosteel raises main steel product prices for Dec
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* Baosteel raises prices by 100 yuan/T

* Wuhan Steel may also raise prices by 50-100 yuan/T

SHANGHAI, Nov 12 (Reuters) - Baoshan Iron & Steel , China's biggest listed steelmaker, said on Monday it will raise its main steel product prices for December by 100 yuan ($16) a tonne, in line with a modest pick-up in demand.

Baosteel's pricing decisions are seen by the market as a signal of the near-term outlook for steel.

Wuhan Iron & Steel , a main rival for Baosteel, will also raise main product prices by 50-100 yuan per tonne for December, its second consecutive increase, market sources said.

An economic slowdown in China, the world's top steel producer, had hit demand for steel, sending prices tumbling 26 percent to three-year lows in early September from the 2012 high in mid-April. Iron ore prices slid 40 percent in the same period.

Baosteel said in a statement it would increase prices for hot-rolled coil of low carbon grade and cold-rolled coil, used in manufacturing, auto making and household appliances.

"Strong steel exports in September and October largely helped domestic flat product prices to rise, but compared to other majors, Baosteel is still more cautious in raising prices," said Hu Yanping, an analyst with industry consultancy Custeel.com.

"The move is within market expectation, due to the seasonal pick-up in end-user demand and improving orders for steel mills, also helped by solid exports in recent months."

Baosteel kept its main steel product prices unchanged for October and November. Late last month, however, Baosteel forecast a slight improvement in the market's performance in the fourth quarter.

Fitch Ratings expects Chinese steel demand to be underpinned over the long term by the country's urbanisation and rising consumption of consumer durables, especially automobiles, a sector which Baosteel sells almost half the cold-rolled sheets it produces. ($1 = 6.2450 Chinese yuan)

Source: Reuters

2012-11-14

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