Japanese Electric Furnace Makers Drastically Cut Output in May

Japanese carbon steel electric furnace makers plan to significantly reduce output for long holidays in May. They concentrate the output for long holidays in May every year due to cheaper electric power charge. But, with unavailability of ferrous scrap purchasing and rising ferrous scrap price, they will stop the operation in many days compared with every years. Japanese biggest electric furnace maker, Tokyo Steel Manufacturing will switch the operation at only night and will reduce the output. Kyoei Steel reduces the output by 50% in Hirakata works. Other makers are expected to reduce the output with material and demand situation. Tokyo Steel Manufacturing said cost increasing by ferrous scrap exceeds cost reduction by cheaper electric charge. The firm produces H-beam at 120,000 tonnes and hot-rolled coil at 60,000 tonnes in April while largely decreases both output in May compared with April. Tokyo Tekko halts the operation of steel making and rolling equipment on April 29, May 5 and 15 until the ended of May including renewal work of heating furnace. Kanto Steel shut off the operation from April 29 until May 4. Ferrous scrap price already pierced 60,000 yen per tonne in some area, which is expected to more rise for long holidays in May. Each maker never seems to produce until its hurts due to unavailability of ferrous scrap. They will form decent market for product and material price by decreased output.