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Demand could push hiked steel prices higher

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STRUCTURAL STEEL section costs were this week expected to keep rising over the next year, after manufacturer Corus announced its latest price hike.

Corus said on Monday that its steel section prices would increase by £20/t for orders placed from 2 October.

It blamed rising raw materials costs for the increase, its second this year. Increases this year have added a total of £40/t to structural steel prices.

This will add about £40,000 to the average £30M, 10 storey office block starting on site in January 2006 compared with 2004, said Corus technical sales and marketing manager Alan Todd .

'The raw material cost of steel went up by 30% in 2005 compared with last year. But our prices don't go up immediately because we have to see if the [construction] market will be able to stand it, ' he told NCE.

Todd admitted that no further steel section increases were planned but that an increase in plate steel would be 'perfectly reasonable'.

He added that the cost of plate steel would be dictated by the shipbuilding industry rather than the building market.

But the commercial director for one major steel fabricator admitted that it anticipated further cost increases totalling £40/t for in 2006.

He said that demand for steel would continue to rise, pushing costs up: 'Looking at the global market for steel, the US will come back strongly, China won't slow down very much and the Middle East is still busy.' The rise in structural steel prices will add to the fierce competition between concrete and steel suppliers.

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