The main EAF-based steel producer in Japan Tokyo Steel has announced a cut in local steel prices for its most products, except beams, for July shipment, given the worsening demand-supply conditions in the international market and the slowdown in demand locally. The market situation is expected to improve only with a revival in orders from September.
Tokyo Steel’s rebar prices have been cut by JPY 5,000/mt to JPY 98,000/mt ex-works, translating to $691/mt and indicating a $55/mt drop from the dollar-based level voiced last month. At the same time, prices for H-beams have remained stable at JPY 127,000/mt ex-works, or are at $895/mt with the dollar equivalent falling by $25/mt due to the exchange rate changes. “Major H-beam producers and primary processors will remain busy. However, small and medium-sized projects lack momentum, and the movement of inventories in distribution remains sluggish... However, it is expected that orders for steel materials for steel manufacturers will advance until the beginning of autumn,” Tokyo Steel said in a note.
Prices for HRC with thickness above 1.7 mm from Tokyo Steel have lost JPY 10,000/mt over the past month, coming to JPY 105,000/mt or $740/mt ex-works with the dollar-based quotations down by $93/mt since June. Quotations of striped coils, hot rolled steel sheets, striped steel sheets and thick plates have been reduced by the same JPY 10,000/mt margin.
In addition, Tokyo Steel’s prices for pickled coils and sheets have been cut the most - by JPY 12,000/mt, while hot dip galvanized coil prices have been reduced by JPY 7,000/mt. The sharper drop in flat steel product prices compared to longs signals worse demand conditions in flats. However, “on the supply side [in flat steel product segment], there is no change in the attitude of steel manufacturers, and the summer production cutback period will begin from next month,” the producer said.