A shortage of steel is forcing Singamas Container Holdings, the world's No2 shipping container maker, to be cautious when accepting forward orders despite near record demand for its boxes. The company, which made more than 466,000 containers for the maritime shipping industry last year, has restricted its forward order book to May despite strong demand due to uncertain steel supply and rapidly rising prices for its core raw material. Last year at this time its order book was full to September. 'We have orders to May but we are very reluctant to quote [forward prices] because of the steel situation,' said Teo Siong Seng, Singamas' chief executive. 'Even if we confirmed supply from the mills, they may not be able to deliver on time. At the moment, we are very cautious about receiving orders.' The price of steel has increased to US$600 per tonne from $380 since last year. Singamas had in turn raised the cost of its basic 20-foot unit about 70 per cent to more than $2,000 per box 'in line with the rise in steel costs', Mr Teo said. The company saw consolidated sales jump a comparative 149.5 per cent last year to US$450.7 million after demand surged and a full-year contribution from its Pearl River Delta-based Shunde Shun An Da Pacific Container plant was included into group accounts. Net profit rose 38.67 per cent from 2002 to US$20.37 million. Sales from its container depot and terminal operations fell 23 per cent to US$18.09 million. But the division's profit before tax rose almost 43 per cent to US$6.35 million. Its Hong Kong depots, in particular, struggled. 'Hong Kong used to be a distribution centre for south China, but that is no longer the case,' Mr Teo said. 'We think that will be difficult to revive, so we are trying to shrink the business.' Given the volatility of the market, Mr Teo was reluctant to make projections about this year's result other than to say he doubted the company's unit production would drop year on year. 'We expect the pressure on the steel supply to ease, but we don't expect the prices to drop,' he said. 'It used to be the steel mills lined up to see you. Now we all line up to see the steel mills.'