Japan: Nippon Steel rolls over H-beam prices for Sept

Nippon Steel has noted the decisions of its rivals and has chosen to keep its domestic H-beam prices for August contracts (September production) unchanged, making the firm's fifth successive roll-over since the Japanese integrated mill increased its prices last March. "We will continue to produce only enough products that meet actual demand," it said in a statement, adding that is still waiting for its price increase to penetrate the market. Nippon Steel had lifted prices by Yen 3,000/tonne ($20/t) in March, as Mysteel Global reported.

Earlier this week, construction steel market leader Tokyo Steel Manufacturing said it would hold all its prices for September, and Kyoei Steel, Japan's largest rebar maker, announced that it too was keeping its rebar prices steady, as reported. On August 24, Osaka Steel, a major producer of I-beams, channels and angles under Nippon Steel's umbrella, announced that it was also holding its prices for a fifth month in September.

"Regarding steel demand trends, the pace of building starts in the construction field, which is the main application, has been slower than the previous year since the beginning of this year and the situation continues," the Osaka mini-mill said in a statement. "In addition to these developments in actual demand, there is also a sense of uncertainty (and) the appetite among distributors to build inventory is extremely low."

The reluctance of dealers to build inventory is also evident in data Nippon Steel released on August 23 relating to H-beam stocks held by its Tokiwakai grouping of domestic H-beam dealers. At the end of July, its network of dealers nationwide held 197,200 tonnes of H-beams, higher by just 800 tonnes (0.4%) from end-June. The volume of beams received by the dealers and the volume shipped from their yards decreased, Nippon Steel said, citing the decrease in the number of working days that month (July 17 being a national holiday in Japan).

"There is some movement in small and medium-sized construction projects, and some say that there have been opportunities lost due to limited availability for certain sizes since last month, but freight movement continues to be sluggish," Nippon Steel observed of the Tokiwakai data.

Nippon Steel never reveals its prices but this week, deals for SS400 grade 5.5/8 x 200x100mm H-beams in Tokyo are being negotiated at Yen 125,000-126,000/t and those on Osaka at Yen 122,000-123,000/t, lower by Yen 2,000/t from March when the price hikes kicked in.

Written by Russ McCulloch, russ.mcculloch@mysteel.com

Edited by Alyssa Ren, rentingting@mysteel.com

Note: This article has been written in accordance with an article exchange agreement between Mysteel Global and SteelMint.