Large-diameter pipe producers agree 15%-17% price rise with Gazprom - paper
MOSCOW. Jan 27 (Interfax) - Russian pipe manufacturers have reached an agreement with gas giant Gazprom to raise prices for large-diameter pipes (LDP) by 15-17% in the first quarter of 2015 due to the depreciation of the ruble, the Vedomosti newspaper said.
The new prices will apply to pipe shipped on or after January 1, one of the paper's sources said. A Gazprom representative said the parties had agreed on prices in the first quarter, but declined to go into million ore detail.
If Gazprom had not agreed to the price hike now, prices would have gone up considerably in the second half of 2015, one of the paper's sources said.
According to the agreements reached, LDP prices will now be reviewed on a quarterly basis. A Vedomosti source said prices would go up again in Q2 2015 as the current increase did not fully reflect changes in market parameters - pipe mills still had unsold inventory of pipes made from steel purchased before the ruble plummeted.
LDP producers started talks with Gazprom on price rises at the beginning of January because the price, calculate as per a set formula, was outdated in view of the ruble's collapse and hike on the Central Bank's key lending rate to 17%.
Russia's biggest LDP producers are TMK , Severstal , OMK and ChelPipe.
