Japan rebar prices up further by $47/t on producers' hike

As of April 27, Japan's rebar prices rose by another Yen 6,000/tonne ($47/t) on week to reach above Yen 120,000/t, bolstered by producers' hikes and achieving the highest ever. As of Wednesday afternoon, deals for SD295A 16-25mm rebars in Tokyo were transacted at Yen 121,000-123,000/t, up Yen 6,000/t on week and Yen 11,000/t higher on month, and some even paid higher at Yen 124,000/t, sources confirmed.

"It has reached above Yen 120,000/t to a par with the list prices tabled by producers, so the increment may be narrowed. But producers may have to lift prices further on persistently rising costs, so the increment will be slower but remain on the uptrend," a Tokyo-based construction steel trader predicted.

He added that the recent rise in Japanese rebar prices is not supported by demand because most rebar buyers have already secured materials by the end of March on anticipation of price hikes, so actual new sales volumes would be much lower.

Kyoei Steel, Japan's largest rebar producer, has lifted its base prices by Yen 10,000/t to Yen 120,000/t for May sales, and other Japanese rebar makers have also set their prices at Yen 120,000/t, as reported.

The trader said that Japanese mini-mills are still actively collecting scrap this week to prepare for their operations during Golden Week holiday starting from the end of this week. But Japanese scrap prices may not rise after the holiday, in response to lower overseas scrap prices.

"Nevertheless, other input costs, especially imported materials, will be higher for Japanese steel producers with the recent depreciation of Yen. So rebar prices won't soften even though scrap prices weakened," he emphasized.

By April 27, Japanese Yen against the U.S. dollar was at Yen 127.9, or having weakened from average Yen 116.3 over January-March and Yen 109.9 in 2021, according to the data from Bank of Japan.

Written by Yoko Manabe, yoko.manabe@mysteel.com

This article has been published under an exchange agreement between MySteel Global and SteelMint.