Weak Rebar Price around Tokyo

Concrete reinforcing steel bar market price is weak at around 100,000 yen per tonne at direct shipment from makers to the users around Tokyo. Users expect the price would decrease more when the demand maintains weak after September. Users are likely to request the price cut to rebar makers when rebar makers’ purchase price for ferrous scrap upped by as little as 3,000 yen per tonne. A large dealer source said the rebar market price is expected to reach 90,000 yen per tonne within this year.

Makers’ contract volume is dropping due to slow demand or the conservative buying of general contractors, which decreased by 43% to 144,000 tonnes in August from July, 101,000 tonnes in September and 119,000 tonnes in October. Makers’ order receipt is expected to be 120,000-130,000 tonnes in November and around 150,000 tonnes in December, when many building construction projects are postponed.

Rebar makers are sustaining the selling price. On the other hand, general contractors continue to request price cut against makers since H-beam price and ferrous scrap price are plunging. General contractors offered the rebar purchase price at around 85,000 yen per tonne in a scheduled price negotiation at the end of October, but the makers refused.

General contractors will request the price cut again when rebar export price is currently below FOB US$ 500 per tonne. Rebar makers are reducing output by 20-30% compared with a regular month. Their contract stocks are decreasing. Some dealer sources said makers may decrease the selling price to secure order volume.