U.S. Steel raising prices, cites costs

U.S. Steel raising prices, cites costs

* CEO says informed customers of raises

* Cites high costs, low inventories, domestic prices

* U.S. Steel stock up 2 percent, AK Steel rises 7 pct

(Adds CEO comments, stock up)

NEW YORK, Aug 11 (Reuters) – U.S. Steel Corp , whose second-quarter profit and sales missed Wall Street estimates, is raising prices as soaring raw material costs eat into margins, Chief Executive Officer John Surma said on Thursday.

Asked at an industrial conference about analyst reports the steelmaker had raised prices by about $60 per ton — or roughly 10 percent — he said: “We informed our customers that that was what we were doing.

“Our view is that underlying demand for what we’re making and selling is OK, costs are still relatively high and inventories are low.

“Prices are lower than we think is appropriate, and we think we should have some margin, some return on our assets,” Surma told the Jefferies Global Industrial and Aerospace & Defense conference.

On Wednesday, another U.S. producer, AK Steel , said it will increase current spot market base prices for all carbon flat-rolled steel products by $60 per ton.

U.S. Steel stock was 2.3 percent higher at $29.53 in afternoon trading on the New York Stock Exchange. AK Steel rose 7 percent to $8.82 on a day when the broader market rose.

(Reporting by Steve James, editing by Maureen Bavdek)

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