Godo Steel, Tokyo Tekko to Raise Rebar Price to 60,000 yen/t

Tokyo based concrete reinforcing steel bar sales joint venture between Godo Steel and Tokyo Tekko will increase the selling price to 60,000 yen per tonne for base size with 19 millimeters diameter in the year. The firm seeks fair price level to keep stable supply when ferrous scrap price increases to more than 30,000 yen per tonne. The firm tries to expand the margin when the scrap price is expected to keep high level. The firm announced 2,000 yen per tonne of hike for October order after the 2,000 yen hike after May. The firm tries to fix additional 1,000 yen of the hike when the users accept 1,000 yen of the hike and the market price increased to 58,000-59,000 yen. Scrap price around Tokyo increased to 31,000 yen per tonne compared with 22,000 yen per tonne at the beginning of the year. The rebar price increased only by 3,000 yen while the scrap price increased by 8,000 yen. Rebar makers’ profitability gets worse due to the lower margin. The makers try to improve the margin when they have 3-3.5 months of order backlog and the demand keeps firm. Godo Steel expects the shipment per day increases in January-March from October-December and the demand keeps firm in the first half of 2007.