UPDATE 2-Steel firm SSAB Q2 profit soars, market strong

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By Simon Johnson and Victoria Klesty

STOCKHOLM, July 24 (Reuters) - Swedish specialty steelmaker SSAB (SSABa.ST: Quote, Profile, Research, Stock Buzz) reported second-quarter pretax profit above market expectations on Thursday and said the global steel market showed no sign of flagging.

Demand for steel has soared in recent years, driven in part by rocketing development in China and India, and is expected to increase nearly 7 percent this year despite turmoil in financial markets that has slowed global growth.

SSAB, which acquired Canadian-U.S. steel firm Ipsco in 2007, posted a quarterly pretax profit of 3.01 billion Swedish crowns ($500 million) against an average forecast of 2.69 billion in a Reuters poll and 1.85 billion in the prior-year period.

The result included a one-off gain 115 million crowns.

Sales in the second quarter came in at 14.96 billion crowns against a forecast 14.4 billion crowns.

"Demand for SSAB's products has been strong and, through increased prices, it has largely been possible to offset the heavy increases in the costs of raw materials," Chief Executive Olof Faxander said in a statement.

SSAB said it saw no sign of demand slowing and aimed to continue to raise prices in the second half of the year after an average 8 percent rise in Sweden in the second quarter and a 20 percent hike in North America.