Japan Rebar Order to Drop to Historical Low in September

Concrete reinforcing steel bar demand gets worse in Japan when the local rebar makers’ order receipt is expected to decrease by 5-15% to around 130,000 tonnes in September from August under slower condominium and building demand. The order receipt is less than historical low of 144,000 tonnes in August. The buyers of general contractors wait for lower price with limited purchase. The industry interests expect monthly negotiation between rebar makers and general contractors could fail to reach agreement in the month as August. General contractors insist lower price while the makers try to keep the price despite of the lower ferrous scrap price. However, some makers could compromise to the buyers to secure the certain volume. Rebar market price around Tokyo is weak at 113,000 yen per tonne for base size both for direct shipment from makers to users and distributors’ inventory sales. A trading firm source said the market price could plunge under lower demand and scrap market, if one of the local makers would reduce the selling price. The industry interests expect the price could decrease toward the end of the month. The interests try to find the next trend by waiting price announcement by Tokyo Steel Manufacturing. Japanese largest electric furnace steel maker of Tokyo Steel has influence on the domestic market nationwide while the maker ships the rebar mainly in western Japan. If the firm would reduce the price widely, the market price could plunge when general contractors increase the pressure for lower price.