POSCO Says Considering Steel Product Price Rises

POSCO, the world's No. 4 steelmaker, said on Tuesday it is considering raising prices on its steel products to bring them in line with international levels and cope with soaring raw material costs.

The South Korean company has been widely expected to bump prices up further since hiking them in February and April this year to pass on the higher costs of iron ore and coking coal.

"Prices should move in line with international levels," POSCO spokesman Choi Doo-jin quoted CEO Lee Ku-taek as saying late on Monday at an industry event.

"We are considering the timing and extent of the rise."

The remarks were a reversal of POSCO's denials Monday of local newspaper reports that it would soon hike prices to reflect higher raw material costs and bridge price gaps with competitors' offerings.

On Tuesday, the Korea Economic Daily quoted Yoon Seok-man, president of POSCO, as saying that the company was struggling to keep product prices at their current, insufficient levels.

"We are studying if automakers and electronics companies could bear (price hikes)," Yoon was cited as saying.

The South Korean company increased prices by as much as a fifth in April, but expectations of further increases have been high as its prices still lag those of Chinese or smaller domestic rivals.

In February, POSCO agreed to a 65 percent hike in iron ore prices with Brazilian mining company Vale.

South Korean newspapers have reported Australian miners Rio Tinto and BHP Billiton have also requested more for iron ore.

Shares in POSCO were flat on Tuesday.