Tokyo Steel Cuts All Steel Items by 7,000-9,000 yen/t

Tokyo Steel Manufacturing announced on Monday the firm reduces the selling price of all steel items by 7,000-9,000 yen per tonne for distributors for July order. The firm reduces the price by 7,000 yen for major items including hot rolled coil and H-beam while the price decreases by 9,000 yen for picking steel. That is the first price down for all items since November 2009. The firm renews the price when ferrous scrap market decreases and import steel increases.

Tokyo Steel is cautious for increasing steel import. The firm sees international steel price decreased by US$ 100 per tonne when Chinese major steel makers reduce the selling price under slowing international demand. The firm estimates Chinese steel export increases with expectation for removal of tax rebate for steel export.

The firm also recognizes South Korean steel makers increase the steel export to Japanese market under lower won rate. A major distributor in Osaka purchased South Korean H-beam at around 67,000-68,000 yen per tonne.

The firm also sees lower scrap price pressures on steel market. However, the firm expects the 7,000-9,000 yen per tonne could stabilize the domestic market with little room for additional price down under the cost structure.

The firm plans the production level in June is in line with May level at around 200,000 tonnes for hot coil, 50,000-55,000 tonnes for H-beam and 25,000-26,000 tonnes for plate steel. The firm sees offshore demand is slow at least for the steel maker. The firm will negotiate with offshore buyers to get around FOB US$ 650 per tonne for hot coil while the firm expects no order for H-beam.

The firm reduces the spot selling price by 7,000-8,000 yen per tonne to 73,000 yen for H-beam, 60,000 yen for concrete reinforcing steel bar and to 70,000 yen for plate compared with previous month.