Tokyo Steel Implements First Price Down for All Items in 7 Months

Tokyo Steel Manufacturing announced on Monday the firm decreases selling price of all steel products by 5,000 yen per tonne for domestic dealers effective for June orders. This is the first price down for all steel items in 7 months. Mr. Naoto Ohori, managing director of Tokyo Steel, said the firm decided the price down as a countermeasure against import steels. He explained imports of steel sheet and shaped steel are increasing. Another factor was price down of ferrous scrap.

Mr. Ohori pointed out Japanese steel import volume doubled in March from February. He showed a concern the import might increase for plate and H-beam. Tokyo Steel decided to lower its selling price since domestic steel prices are higher than imported products.

Mr. Ohori said domestic steel demand represents weak after Japan Earthquake. Tokyo Steel accepted orders at total 2,000-3,000 tonnes per month for temporary houses in disaster areas but steel demand recovery from manufacturing industry is limited and and building construction projects are called off or put off. The demand for the restoration in disaster areas would increase in 2012, said Mr. Ohori.

Tokyo Steel also lowered its export price in May but the firm is failing to conclude new export contracts. The firm’s export offer price is about FOB US$ 800 per tonne for hot rolled coil and US$ 890 for H-beam. These prices seem higher than the export market price level.

The firm’s steel production is estimated to total 220,000 tonnes per month for May-June. Tahara works’ production was 30,000 tonnes in April and is estimated at 40,000 tonnes in May. Thanks to Tahara works’ stable operation, steel sheet production would increase to 120,000 tonnes per month. The production volume is expected at 70,000 tonnes for H-beam and 30,000 tonnes for steel plate.