Nippon Steel to Reduce Pipe Supply by 10-15% to Domestic Dealers

Nippon Steel reduces the supply of construction steel pipe products including structural pipe and gas pipe by 10-15% for distributors in August and September period. The firm tries to improve the supply balance when domestic building and construction demand could keep low after October. Japanese housing start is expected to decrease in fiscal 2008 started April from fiscal 2007 due to higher house price and slower economy. Japanese nonresidential building start is also expected to decrease while civil works continue to decrease with limited budget. The dealers’ shipment of those pipe products get slower since May. Nippon Steel tries to minimize the supply to meet the lower demand level and the dealers’ inventory keeps normal level. However, the firm decided the additional supply reduction when the firm expects the demand could decrease more after October. The firm increased the selling price of all pipe products by more than 15% for domestic market for July shipment. The firm tries to find the timing for another hike by improving the supply balance when the cost keeps increasing for raw materials and energy.