Japanese H-beam Dealers’ Inventory Hits 36-Year Lowest

Japanese H-beam inventory decreased by 9.9% to 179,900 tonnes at the end of March from a month ago, held by members of Tokiwa-kai, which is a group of distributors dealing Nippon Steel’s products, according to Nippon Steel. The inventory decreased for 5 straight months and represented below 180,000 tonnes for the first time in 36 years and 4 months. The inventory to shipment was 1.74 months, the generally moderate level. Nippon Steel explained the inventory decreased due to wide increase of the shipment.

Nippon Steel indicated the firm would announce additional price hike of H-beam soon for the stable product supply when steel material supply keeps tight. The firm will continue output reductions of H-beam by more than 70% and regulation of order receipts from distributors.

Nippon Steel raised H-beam selling price by 15,000 yen per tonne effective for April contracts while eyes the additional price hike to gain appropriate profit. The firm explained ferrous scrap supply is tightening mainly for export while raw material costs are strongly surging.

Nippon Steel analyzed H-beam inventory decreased due to speculative orders before the price hike. Actual demand is unlikely to recover in a short term. The firm tries to improve the supply and demand balance by supply reductions.

The inventory decreased by 10% to 102,300 tonnes in Tokyo, Osaka and Nagoya at the end of March from a month ago. The product arrivals increased by 2.6% while the shipment kept flat. The inventory to shipment was 1.65 months, lower by 0.19 points.