The metallurgical companies of Russia have notified their clients about the intention to revise prices for June supplies. The biggest increase of 30 percent to 35 percent will extend to the pipe shells.
Photo: Konstantin Melnitsky
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Metal Makers Hike Prices Again
The metallurgical companies of Russia, which prices are already the concern of Federal Antimonopoly Service, intend to hike them anew. The metal giants have notified clients about the intention to revise prices for June supplies. The biggest increase of 30 percent to 35 percent will hit the pipe shells. The refusal of oilmen to agree to pro-rata growth in pipe prices (which has happened already) will put their manufacturers in financial straits.
The biggest metal makers notified their clients about the price increase straight after the May vocations. The obvious victims are the pipe manufacturers, as they will have to endure the price increase of 35 percent. Given that the prices for coiled stock and sheets increased by nearly 35 percent under the Q2 contracts, the metal shell prices for Russia’s firms will surge by 82 percent vs. the start of the year.
The metal makers declined to comment on the increase, but a source in one of the companies confirmed it, refusing to specify the definite percent. The growth in metal prices is in line with the global trend, although overseas, they make no secret of it. Steel biggest maker ArcelorMittal has hiked the cost of the metric ton by 20 percent.
The key clients of pipe makers, the oil companies, are likely to oppose the increase, at least they refused to do it in April. In LUKOIL, they say they learnt about another growth in late April or early May and are by far not pleased with the news. A source with Rosneft said they might partially reject the pipes of Russia in favor of cheaper pipes of Ukraine and China. So far, only Gazprom has confirmed new prices for the pipes of big diameter.
www.kommersant.com
All the Article in Russian as of May 16, 2008
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