Japan's Kyoei holds rebar prices for June sales

Despite signs that ferrous scrap prices in Japan have bottomed, the country's largest rebar producer, Kyoei Steel, has decided to continue holding domestic prices for base-size rebars for June shipments, it announced on April 23, making for the second successive monthly rollover, Mysteel Global notes.

"Demand for (construction steel) products has remained steady, including large-scale projects centered on urban redevelopment projects and logistics warehouses, and cargo movement is currently stable," Kyoei said in a statement on Tuesday. "On the other hand, though raw material prices are showing signs of bottoming out, production costs such as electricity charges, auxiliary materials, and freight rates remain high," the mini-mill said to explain the reason for keeping its selling price unchanged.

The Osaka-based steelmaker had raised its rebar prices for March sales by Yen 5,000/tonne ($36/t) and lifted them again by a further Yen 3,000/t for April sales, as reported. In its statement, Kyoei said it will wait for market conditions to allow for "the price increase so far to penetrate."

On Monday, market-leader Tokyo Steel Manufacturing had announced that it would be keeping all its list prices unchanged for June shipments, as reported, with its price for D13-25mm rebars holding steady at Yen 103,000/t.

Kyoei never reveals its list prices but as of Tuesday morning, deals involving SD295A 16-25mm rebars in Tokyo were still being negotiated at Yen 118,000-121,000/t - unchanged since January, despite the makers' price increases - while those in Osaka, Kyoei's home market, were at Yen 107,000-108,000/t, lower by Yen 2,000/t in the past month, according to market sources.

Preliminary steel production data from the Japan Iron & Steel Federation, also released on Tuesday, showed that nationwide production of small bars (mostly rebars) totalled 671,300 tonnes in April, down 1.7% from April last year and marking the tenth consecutive monthly on-year fall, as Mysteel Global reported.

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

Edited by Alyssa Ren, rentingting@mysteel.com

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