Sheet Steel Price to Decrease along Slower Demand

Sheet steel market price is weakening around Tokyo due to slower demand not only for construction but for other applications. Some coil centers’ selling prices are lower than purchase price. The price is expected to decrease more when some dealers and coil centers reduce the inventory.

The steel sheet market price is 96,000-97,000 yen per tonne for hot rolled flat steel, 98,000-110,000 yen for pickling steel, 108,000-110,000 yen for cold rolled flat steel and 123,000-114,000 yen for electro galvanized sheet based on cold rolled steel.

One coil center source said the shipment gets lower since August. From this summer, the demand for manufacturing weakened drastically, affected by Japanese products export decreases under global slow economy and higher yen rate. The demand for industrial machinery and electronics also decreases.

Subcontractors decrease the sheet steel purchase when their inventory becomes too much after they secured more than consumption during tight supply. Total inventory of sheet steel at makers, dealers and coil centers increased by 2.0% to 4.4 million tonnes at the end of September compared with August.

Japanese integrated steel makers plan to cut the steel output by 2 million tonnes in 6 months to March 2009. The sheet steel inventory adjustment could take longer time when the all applications are in adjustment.