Japan Stainless Sheet Price Expected to Hit Bottom

Japanese stainless steel market price is expected to hit the bottom before Japanese long holidays in early May. Many dealers finished inventory valuation loss within fiscal 2008 ended March 2009. At the same time, inventory adjustment has progressed at makers and dealers. Additionally nickel price seems to hit the bottom at London Metal Exchange. As to ferrochrome, the price may decrease from 87 cents per pound for April-June. But many dealers prospect ferrochrome price would not largely decline when the price had already lowered by around 55% from previous term.

Many dealer sources say their sales volume dropped in March from February despite of less business days in February than in March. Meanwhile, Japanese cold rolled stainless sheet inventory decreased by 39% to 47,085 tonnes at the end of February compared with the peak. A dealer source said some size products are in shortage.

Some stainless steel makers lowered operation rate of steel making by around 30% compared with the capacity. Their inventory adjustment efforts are showing some effect in the market.

At the same time, inventory valuation loss would shrink at stainless makers and dealers in a new fiscal year started April.