Japan Brass Coil Import Sharply Shrinks from South Korea

Japanese brass coil import has rapidly shrunk since autumn 2008, which is a material for brass sheet and strip. The import exceeded 1,000 tonnes per month for several times during the first half of 2008 thanks to its lower price than Japanese products. However, the import turned to the sharp decrease after electrolytic copper market price plunged in autumn 2008. The backgrounds are slow demand for brass products in Japan, lowered unit price and unstable supply by South Korean makers.

Japanese brass coil import totaled 13,461 tonnes through 2008, which increased by 20% from 2007 and accounted for 11% against Japanese domestic output. The import from South Korea was 11,209 tonnes, 83% of the total import.

However, the import rapidly decreased after August 2008. The import dropped to 295 tonnes in January 2009, 124 tonnes in March and 76 tonnes in April. The unit price of imported brass coil is less than 400 yen per kilogram, lower by 30-40% than Japanese domestic price. Despite of the cheap price, orders for offshore brass coil widely shrank. One reason is that domestic market price also lowered.

Another reason is delivery lead time. Domestic makers’ delivery lead time is usually 7-10 days while South Korean makers’ delivery takes longer time with irregular span. South Korean makers supply surplus products as export and, that is, the supply volume is unstable. Japanese users are also concerned that imported products are without quality guarantee. Consequently domestic users seem returning to domestic products.

South Korean makers currently appear to export brass coil to China, where the domestic demand is very strong.