Tokyo Steel Hikes April Steel Bar Prices, 1st Rise in Over 2 Yrs
23 March 2016
Tokyo Steel Manufacturing , Japan's top electric arc furnace steelmaker, will raise prices of construction-used steel bars for April delivery by 5 percent in its first hike in over two years, reflecting a rebound in spot prices at home and abroad.
The company will increase prices for steel bars, including rebar, by 2,000 yen ($17.83) to 44,000 yen a tonne, it said in a press briefing on Tuesday.
That is Tokyo Steel's first price hike since January delivery in 2014, possibly indicating that the market has bottomed out after slumping on oversupply.
Tokyo Steel's pricing strategy is closely watched by Asian rivals such as Posco, Hyundai Steel Co and Baosteel, which export to Japan.
Prices for the company's main product, H-shaped beams, which are also used in construction, and other products including hot-rolled coils and heavy plates will remain unchanged in April.
"We believe the domestic steel market has hit a floor following a sharp rebound in overseas prices, led by price hikes by Chinese mills," Tokyo Steel's Managing Director Kiyoshi Imamura told reporters.
On the Shanghai Futures Exchange, construction-used rebar futures for October delivery hit a nearly nine-month high on Monday, as a recovery in China's housing prices boosted hopes for demand for the commodity.
"We expect an upward trend in steel prices to continue as domestic demand for construction materials is solid and inventory for that steel is low," said Imamura.
But Japan's crude steel output fell in February for an 18th straight month, the longest streak since the 1997-99 Asian financial crisis, hit by slow auto demand and low export prices.
Still, Imamura forecast a stronger pick up in local demand in and after summer as a new national stadium project and other Olympic-related works are poised to start early next year.
Source : reuters.com