Japan, Steel Tube Supply to Still Tighten in May

Japanese steel tube supply is expected to become tighter in the first half of fiscal 2008 started April when dealers’ inventory would decrease sharply. Hot rolled and pickled steel coil supply is decreasing by Japanese integrated steel makers to Japanese steel tube makers with globally strong steel demand. Japanese integrated steel makers are offering tube makers to reduce orders. Some makers might face difficulty in stable supply of steel tube for building construction as well as for machinery structural use such as automobiles.Some steel tube makers have already offered the consumers to adjust the order volumes for steel tubes made by hot coils for buildings as well as steel tube made by pickled coils for machinery structural uses.Dealers’ tube shipment increased temporarily in March when steel tube makers announced price hike by over 20,000 yen per tonne effective for April shipment. Nominal demand settled down in April. However, a major dealer source said tube procurement keeps still difficult when tube makers continue to reduce order acceptance and the supply would become even tighter after long holidays in early May when dealers’ shipment is expected to increase.