Sumitomo Metals Plans to Revise Domestic Pricing of Seamless Pipes
2011.02.25
- Sumitomo Metal Industries, Ltd.
Sumitomo Metal Industries, Ltd. (Sumitomo Metals) has begun negotiations to revise domestic pricing of seamless pipes (except stainless steel) for all domestic customers.
1. Overview of the negotiations
| (1) Scope | |
| The revision will apply to all domestic customers (long-term contract customers and spot customers) of seamless pipes (except stainless steel). |
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| (2) Timing | |
| The revision will be applied to seamless pipes produced from April 2011 onwards. |
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| Depending on pricing of raw materials and development of other factors, further revisions may be negotiated on a quarterly basis. |
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| (3) Price revision | |
| The revision will be an incremental price increase of 15%. |
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2. Background of price revision
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Demand for seamless pipes is expected to stay robust for energy-related exports and in construction machinery, industrial machinery, and other areas in Japan in the next fiscal year starting April 2011. |
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On the cost front, prices of iron ore, coal, and other raw materials are rising. In particular, spot prices of coal have shot up since floods hit Australia in December 2010. This will inevitably affect prices of raw materials in fiscal 2011. |
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Given such circumstances, Sumitomo Metals has begun to ask customers for their understanding. |
3. Other
| Sumitomo Metals is also planning to negotiate similar price increases of gas tubes and other welded steel pipes. |
