Baosteel to raise steel product prices in Feb

SHANGHAI (AFP) — China's leading steel maker Baosteel will raise prices of major products in February, the first hike since August amid confidence that demand is growing, state media reported Thursday.

Baosteel will increase the price of cold-rolled steel by 300 yuan (44 dollars) per tonne, the official China Securities Journal said, citing industry sources.

It did not provide the current price of cold-rolled steel, but data from Lange Steel Consulting firm showed it will mark a rise of seven percent from January's average of 4,271 yuan per tonne for one-millimetre-thick cold-rolled steel.

Baosteel has cut prices for major steel products four times since August due to weakening demand, the report said.

"The sudden reversal reflects that market confidence has steadily improved and panic selling has gradually disappeared," Xu Xiangchun, a Beijing-based analyst with Mysteel Research, told the journal.

"In line with Baosteel's move, other large steel mills like Anshan Steel will also consider raising product prices," Xu said.

The report added, however, that other analysts argued the price rise did not necessarily signal a general recovery as global demand remained fragile amid spreading economic woes.

China's steel industry recorded a combined loss in October, the first time in six years it has slipped into the red, according to earlier media reports.