Nippon Steel Reduces H-beam Supply by 20-30% in February Shipment

Nippon Steel reduced the accepted order of H-beam for distributors by 20-30% in January contracts and February shipment from the previous month. The distributors’ H-beam inventory held by member of Tokiwa-kai, which is group of distributors dealing Nippon Steel’s H-beam, decreased to 256,000 tonnes at the end of December, which decreased for 9 consecutive months. Despite of the decent inventory level, the distributors have never pass the price hike of 2,000 yen per tonne in last autumn by each integrated steel makers on their selling price with some region. The market price is turning flat. The firm aims the adjustment of the supply and demand situation by the order reduction.Tokiwa-kai inventory was 1.8 months of the shipment per month in the end of December 2006. In the past, the market price increased when the inventory rate was below at 1.7 months. Nippon Steel will reduce the order for more decrease of the inventory. The firm reduced the accepted order by 20-30% in November 2006 contracts from a month ago for Tokyo area which is biggest market in Japan. The inventory was 1.89 months of the shipment per month in the ended of November, which was below 2 months in 10 months. However, the inventory increased to 1.96 months. The inventory was 1.43 months of the shipment per month in the ended of December 2006 in Osaka area, 1.47 months in Nagoya area. The inventory in both areas was low compared with it in Tokyo area. Nippon Steel will more reduce the supply for Tokyo area, adjusts the supply and demand in principal cities.