Japan: Nippon Steel raises H1 prices for auto, construction, machinery segments

Nippon Steel Corporation's negotiations with customers in the automobile, electrical machinery, construction materials and other industries for the first half of fiscal 2022 are reaching a closure.

The company has agreed to raise prices by 10,000 to 20,000 yen per tonne (t) ($86-173/t) compared to H2 FY'21 with many customers, including those from the electric appliances and construction materials segments.

Price determining policy

The company is shifting to a "predetermined method" in which it will decide the price, approximate quantity, and other conditions before shipment, and the timing of price negotiations is being brought forward.

Nippon Steel Corporation's policy on price determination is that, in principle, the volume and price should be fixed ahead. The company is also negotiating with customers who have not yet agreed on the prices, with the aim of reaching an agreement by the end of this month.

The company requested a price hike of approximately 60,000 yen per tonne ($519/t) for thin plates' in negotiations with retailers in FY'21. Some cases were settled at the full price, while others are believed to have been settled lower.

Outlook

The company is poised to continue raising prices in FY'22 based on negotiations in FY'21.

Although the timing of raw material delivery varies, consumers have been understanding about the new prices, and the only question now is when to introduce the same.

Note: This Insight has been published in accordance with an article exchange agreement between SteelMint and Japan Metal Daily.