Squeezed Japan Steel Wire Products’ Margin with Higher Cost Price

Steel wire products makers and dealers in Osaka are concerned about higher cost price. They would experience hard time to pass the cost increase to the selling price while integrated steel makers and electric furnace steel makers increase the price 10,000 yen per tonne for the shipment in July.

The demand remains low for construction while some steel products price levels off and ferrous scrap price decreased. The shipment of wire rod products is expected to decrease in July due to the seasonal factor. However, wire rod products makers and dealers are concerned about whether the demand increases after fall, a dealer said. The sources had difficulty increasing the selling price after the wire rod makes increased the price from the shipment in April.

The sources are concerned about the increase in the wire rod import. Japanese carbon wire rod import increased by 26.8% to 31,208 tonnes in May from April, according to Japan Wire Products Association. The wire products makers could increase low-priced wire rod import from China to minimize the cost increase while China government leaves the export tax refund unchanged.