The Russian steel trader Brok-Invest-Service, analyzing the situation in the steel market in Russia's Central Region, has said that local steel products prices will increase in January 2010, considering the good situation in the export markets and the expected increase in production costs caused by the rise in iron ore prices, the rise in scrap prices, the increase in railway tariffs, and rise in energy prices.
Accordingly, in the rebar market in Russia's Central Region, producers announced a 2-4 percent increase in their prices for January. Thus, traders' purchase prices for January will be higher than the current selling prices, which will inevitably lead to an increase in their sale prices too, Brok-Invest-Service said.
In the Central Region flats market, a serious limitation in supply volumes to traders has been noticed. In early 2011, a possible shortage of products could be registered. According to Brok-Invest-Service, the increase in prices for hot rolled and cold rolled steel products could be at least 2-4 percent.
In addition, an increase in selling prices is also expected in the electric-welded and profile steel pipes market in the Central Region, considering the growth in steel strip prices for pipemakers by about Ruble 1,000/mt ($32.7/mt) and a significant decrease in strip supplies to producers. The prices for seamless steel prices are expected to increase by about 10 percent in January, Brok-Invest-Service.
Brok-Invest-Service is one of the largest independent steel traders in central Russia, with a six percent share of the regional market.