Rebar Price Ups by 3,000 yen/t in Tokyo

Concrete reinforcing steel bar price increases by 3,000 yen to 63,000 yen per tonne for base size with 19 millimeters diameter at trading firms’ selling price to general contractors around Tokyo. The price increased after the distributors’ effort to cover 3,000 yen hike by local makers. Some transaction price reached 64,000 yen and the price could increase more next week. Local rebar makers increased the selling price by 3,000 yen to 62,000 yen per tonne for base size to cover higher ferrous scrap price, which is more than 30,000 yen per tonne for H2 grade. A maker official said scrap price increased by 10,000 yen or 40% in 2006 and the maker tries to increase the selling price with expectation high level could keep longer. With the higher cost price, the trading firms increased the offer price to 63,000-64,000 yen per tonne for general contractors while the smaller distributors increase the selling price to 67,000-68,000 yen for shipment from their inventory. The dealers try to improve the margin through the hikes under higher raw materials price despite of lower order from general contractors. The strong building demand around Tokyo supports the price. Local rebar output increased by around 10% to 3.9 million tonnes in 2006 from 2005. The output was the level in bubble economy and could reach 4 million tonnes in 2007. A trading firm source said the firm tries to secure profit for each transaction when the demand would increase from previous year.