September 07, 2008

Sumitomo Metals to hike domestic price for seamless pipes

Sumitomo Metal Industries Ltd has announced that it is in negotiations with customers regarding a domestic price increase for seamless pipes. It is considering a 15% increase.

It said that price increase would apply to all domestic sales both spot and long term contracts for seamless pipes produced from April 2008 onwards.

It said that seamless pipe supply demand is tight, so a price increase is necessary to ensure international parity and a stable supply. It added that “Moreover, we expect a rise in the price of iron ore, coal, ferrous alloys, and other raw materials in FY2008, as well as a rise in shipping charges.”

Sumitomo said that “Overseas energy sector demand for seamless pipes should remain robust in FY2008. Domestic demand is expected to remain strong as well, particularly from the construction, industrial machinery, and plants sectors. Moreover, our customers have requested an increase in seamless pipe supply. At the same time, Sumitomo Metals believes its existing facilities are insufficient given current demand and forecasts for the future.”

The release added that Sumitomo Metals is also considering raising its gas tubing price in April.