Japan Distributors’ Steel Stock to Decrease at the End of March

Japanese distributors’ steel inventory is expected to decrease at the end of March, representing decreases for 2 consecutive quarters, according to Japanese steel distributors’ associations. Makers’ output reduction is expected to reduce the inventory in January-March though the flat steel stock is slow to decrease. H-beam stock also increases due to seasonal factors including heavy snow and the New Year holiday. Japan Steel Product Dealers Association, Japan Steel Plate Shearing Industrial Guild and Japan Coil Center Industry Association reported outlook for steel inventory held by distributors at the end of December and March and steel demand in January-March. The product dealers association said the inventory decreased by 1% to 2.734 million tonnes at the end of December from 3 months ago. The plate shearing guild reported the inventory decreased by 3.9% to 490,000 tonnes and the coil center association said the stock decreased by 1% to 1.042 million tonnes. The distributors’ inventory was low level for long products in October-December. However, the flat steel stock didn’t decrease much due to slower demand and just beginning of the output reduction by makers though the inventory was expected to decrease more under the demand season. The distributors’ associations expect the inventory will keep decreasing toward March due to strong demand from manufactures. The point is effect of output reduction and import for the inventory adjustment of flat steel. Nippon Steel said H-beam inventory held by members of the dealers’ group of Tokiwakai increased at the end of December from previous month, representing increases for 2 months in a row. The stock revel reached 1.8 months for the shipment, which was higher than usual level. The stock is the point for the long products inventory. The demand is expected to keep the level both for long and flat products in January-March. However, the heavy snow is negative factor to increase the stock for long products.