Japan Billet Export Price Drops for Asia

Japanese billet export price decreases when electric furnace steel makes increase the export in and after October shipment to cover domestic lower shipment under very slow building activity due to transition process for new building standard law. The export price decreased by around 10% or 7,000 yen per tonne in 2 months and the makers are likely to reduce the price more at ongoing negotiation for shipment in mid-December and after. Japanese concrete reinforcing steel bar export price keeps still high price but could decrease in the year. The export price of billet decreased to FOB 58,000 yen per tonne for early December shipment compared with 65,000 yen for late October. Japanese makers increased the export to South Korea with firm demand. South Korean buyers reduce the bid when Japanese makers have additional capacity under slower domestic demand. A Japanese maker source said Russia resumed billet export after temporally stop. With those supply, the market gets oversupply. Japanese billet export incased to 73,453 tonnes in September, which was 9.5% higher than August and 28.8% higher than a year earlier. The export is expected to increase in October. The higher supply from Japan is a part of reason for the lower price. Japanese rebar export price is FOB 66,200 yen per tonne for South Korea for December shipment, which is higher than 65,000 yen for November. However, the ongoing negotiation has different mood. Japanese makers diverted from USA to South Korea after summer due to slower demand in USA with subprime loan issue. South Korean buyers try to reduce the price with sufficient supply. South Korean buyers bid FOB 63,500 yen per tonne for Japanese rebar for January shipment. Despite of the strong appetite, their price down pressure could impact on the export price along with dropping billet price. Asian steel export market is in adjustment phase when Japanese export price also decreases for slab and ferrous scrap.