Tokyo Steel Cuts H-Beam Output by 30% in July, August

Tokyo Steel Manufacturing will reduce the H-beam output by 30% in July and August from June level. The firm tries to keep the selling price through the output reduction when the firm plans regular maintenance at all 4 plants from July 27 to first week of August. The largest H-beam maker extends the supply balance control when the demand is slow toward summer holiday season. The H-beam output is expected to decrease to around 100,000 tonnes per month in July and August from 150,000 tonnes in June. The level is more than 20% lower than 130,000-140,000 tonnes per month in July and August 2006. The firm keeps the selling price at 77,000 yen per tonne for 6 months since the hike in March order. The firm tries to keep the price level through the major output reduction under slower demand. Japanese integrated steel makers keep low level order acceptance for H-beam from distributors to balance the supply to the low level demand. The supply could become tighter with the major output reduction by the top share maker of Tokyo Steel. The distributors expect the market price could increase with the supply cut and try to find the timing to increase the reselling price.