South Africa’s Trade and Industry Minister Mandisi Mpahlwa on Wednesday said that government was concerned about the trend of high input costs and made specific reference to the steel and chemicals sectors.

Commenting at a media briefing on Mittal Steel South Africa’s announcement on Friday that it would increase the prices on flat- and long-steel products by a weighted average of 5% from next month, Mpahlwa said that his department was in continuous engagement with Mittal.

“We remain interested in containing costs and looking at the impact it has on smaller players.”

Earlier Mittal Steel SA CEO Rick Reato said that the company attempted to keep the lid on any price increases, but that international price trends had required it to increase the price on selected products.

The group sets its prices against a benchmark of domestic prices elsewhere in the world, using a basket of prices in six countries, including Brazil, the US, Germany, Korea, China and Russia. The method was introduced last year given growing unhappiness with the import-parity-pricing model employed previously.

Meanwhile, Mpahlwa aid that the Department of Trade and Industry was also working with various stakeholders in the chemicals industry to ensure downstream beneficiation.

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