U.S. Steel to launch a new round of price increased

Due to increased costs and tight supply, in
early November, the United States steel mills comprehensively launched a new
round of price increased, this initiatives is expected to push the U.S. market as
a whole rose.

California iron and steel company, USS-Posco,
Severstal North America and AK Steel Corporation have announced Sheet price
increased, the range is 20-60 U.S. dollars / short ton. After price increased,
ex-factory price of hot coil rose to 680-710 U.S. dollars / ton, ex-factory
price of cold rolling rose to $790-820 / ton. Gerdau Long Steel North America, Steel
Dynamics Corporation, Nucor Steel Company and Commercial Metals Company have
increased rebar prices 10-20 U.S. dollars / short ton, after adjusting Midwest
mill of rebar prices rose to 650-680 U.S. dollars / short ton. Nucor Steel
Corporation also announced price of plate further increased $ 40 plate / short
ton. Adding the October price increased totally raised $ 70 / short ton, A36
commercial grade plate of ex-factory price will rise 770-790 U.S. dollars /
short ton. In addition, North American companies Gerdau Long Steel North
America raise wire rod prices to 30 U.S. dollars / short ton, wire ex-factory
price will rise to 660-670 U.S. dollars / short ton.

November U.S. scrap price increased by $
20-30 / long ton, steel mills of raw material costs increased substantially, at
the same time close to the end of the year buyers started to replenish stocks, while
both domestic and imported resource began to appear shortage. Preliminary
statistics show, October U.S. steel imports MOM dropped by 44%, compared to
last year decreased 37%, the imports since March 2010 to reach its lowest level.
Increased costs and supply shortages are the main reason for helping steel
mills to increase price.

As good basic for the U.S. market, this
round of price increases is expected to be accepted by the market. Market is
expected next year a quarter sheet imports will continue to shortage, therefore,
to the end plate market can absorb at least some of its gains. In the field of long
product, due to rebar prices are still low, the market is expected to absorb at
least 10 U.S. dollars / short ton of gains; because wire demand is relatively
weak, the rate of increase is limited. Thick market due to supply shortages,
price increased are expected to be accepted, however, considering the potential
import pressures, continued upside may be limited.

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