Major metal producers step up prices

A number of Russian metal factories of the co-called first and second tierare raising their disbursement prices effective September 1. For example,the press service of the Magnitogorsk Metal Works reports about a 3-percentgrowth in prices for tin. The metal producer is also increasing prices forhot-rolled steel and tin-plate by 20 percent, cold-rolled sheets, blanksand reinforcements by 10 percent and galvanized sheets by 8 percent. Pricesfor shipbuilding steel remained unchanged, and the range of prices formetal rolls and metal sheets was reduced from 4 to 3 percent. TheMagnitogorsk Metal Works link this move to quite a sustainable growth ofthe order portfolio despite the previous price increase in July.Severstal is also raising prices on some of its products. According to OlgaEzhova, head of the press service of the Cherepovetsk Metal Factory, briskdemand will push up the prices of bar soon. She said that the priceincrease would not affect AvtoVAZ, a number of engineering plants andconsumers, whose contracts with the metal factory were valid until the endof this year. Second-tier metal works also decided to step up some of their prices. Forexample, the Kuznetsk Metal Works is raising prices for alloyed steel, sometypes of steel strips and pit props. The average price growth will amountto 3.5 percent.In turn, pipe makers, which are major consumers of metal, increased theprices of their products. For example, the Unified Metal Company has beenregularly raising its prices for pipes since July. It is planning to stepthem up again on September 1. "The current situation on the Russian metalmarket is quite alarming. Due to the fact that metal accounts for 60 to 70percent of the cost of pipes, constant price increases seriously challengethe profitability of pipe products," said Victor Datsko, deputy chief ofthe department for managing the pipe complex of the Unified Metal Company.The Industry, Science and Technology Ministry scheduled a meeting with pipemake! rs and metal producers for September 9 in order to solve problemsarising in relations between them. "We hope to coordinate our stances atthis meeting to increase the competitiveness of Russian pipes and be readyfor possible changes on the Russian pipe market in light of thecancellation of quotas set for Ukrainian pipe producers," Datsko said.