Electric Furnaces to Raise Rebar Price to Above 60,000 Yen/t, Tokyo

Electric furnace steel makers around Tokyo aim to raise the sales price of rebar to higher than 60,000 yen per tonne for the base size with 16-25 millimeters diameter. They try to improve profitability when ferrous scrap price is surging and rebar demand is recovering for constructions. Domestic ferrous scrap market price has risen in a month along upsurge of ferrous scrap export price to East Asia. Then spread between rebar price and scrap cost has narrowed.

Rebar shipment has improved in current several months for large-size condominiums or residents around Tokyo. Local electric furnaces’ rebar shipment increased by around 20% to more than 300,000 tonnes in October from September.

Rebar users have slowed orders since October while the demand maintains firm. Moreover, there is alternate production for steel makers in Tohoku area due to aftermath of the Great East Japan Earthquake. Local electric furnaces’ shipment is expected to keep 250,000-270,000 tonnes per month in and after January, higher by 30,000-50,000 tonnes than a year earlier.

On the other hand, ferrous scrap market price is rising. Export tender price increased by 3,620 yen to FAS 31,211 yen per tonne for H2 for December contracts at the latest tender held by Kanto Tetsugen Kyodo Kumiai, an association of regional ferrous scrap dealers. Local electric furnaces purchase H2 at 30,000-31,000 yen.