The situation in the global steel market has worsened in May and, even though sales activity in the local Japanese market has been relatively firm, the main EAF-based steel producer in the country has decided to keep its local steel prices stable for June, thereby keeping its prices stable for the second month in a row.
Tokyo Steel’s rebar and H-beam prices have remained stable at JPY 103,000/mt ex-works and JPY 127,000 mt ex-works, equal to $746/mt and $920/mt respectively at today’s exchange rate. Even though prices in the local currency have remained stable from last month, they have lost $22/mt and $24/mt respectively in the dollar equivalents due to the yen rate fluctuations. “We anticipate an increase in orders, and an improvement in market conditions due to the tightening of the supply-demand balance,” Tokyo Steel said regarding the local longs market in Japan. Nevertheless, the negative developments in the international market have been preventing prices from recording the rises which Tokyo Steel had implemented in March. “In the overseas market, China's domestic demand remains lackluster, and, due to the effects of oversupply, steel exports have continued to increase. In addition, there is the continuation of inflation-control policies in various countries and the stagnation in demand due to the lingering financial instability in some countries,” the company said.
Prices for HRC with thickness above 1.7 mm from Tokyo Steel are still at JPY 115,000/mt or $833/mt ex-works with the dollar-base quotations down by $24/mt over the past month. Tokyo Steel said that it expects supply of HRC in Japan to decline in the near future due to “the renewal of equipment by some manufacturers”, which may support the market conditions. However, increasing volumes of cheaper imports are still raising concerns in the Japanese flat steel products market.