Japan: Tokyo Steel keeps steel prices unchanged for April'24 sales

Tokyo Steel, Japan's leading electric arc furnace steelmaker, maintained its prices for HRC (1.7-22mm), rebar, and H-beams for April 2024 sales. Notably, prices held steady for the ninth month in a row.

• HRC (1.7-22mm): JPY 107,000/t ($717/t)
  
  
• Rebar (D13~25): JPY 98,000/t ($657/t)
  
  
• H-beam (100-300mm): JPY 127,000/t ($851/t)
  
  

The global steel market is currently experiencing a period of adjustment. With sluggish business activity worldwide, steel exports are up and market prices are trending downward, particularly in Asia. This has led buyers to adopt a wait-and-see approach.

Factors affecting prices-

Key global steel mills rollover prices: Reflecting the cautious market, the world's leading steelmaker Baosteel held HRC prices steady for April, 2024 sales after raising them in March, 2024, while China Steel Corporation (CSC) also kept prices flat for steel products like HRCs, HR plates, CRCs and hot-dipped galvanized steel coils. However, Formosa Ha Tinh (FHS) has trimmed prices by around $15/t for April-May shipments.

Japan's Kanto scrap export for March 2024 witness a decline m-o-m: Around 5,000 tonnes (t) of H2 scrap were secured in the recent Japanese Kanto export tender, at JPY 50,100/t ($340/t) on a FAS basis, marking a significant decline of JPY 2,987/t ($20/t) compared to the previous month. The FOB price is estimated to be around JPY 52,000-52,500/t ($352-356/t), equivalent to INR 29,445/t (FOB).

Steel market overview of Japan: In the domestic building materials sector, there's a notable concern surrounding potential delays in construction timelines for major projects due to the ongoing implementation of work style reforms within the construction industry and a decrease in the available workforce. However, despite these challenges, there's a positive momentum as construction activities are gradually picking up pace.

Outlook:

Given the prevailing conditions, Tokyo Steel has decided to maintain current pricing levels for all products this month.

Moreover, there has been a buildup of inventory in the market due to sluggish cargo movement since the beginning of the year. Although this has led to some temporary stagnation, the inventory levels are generally low. Consequently, as supply and demand dynamics adjust, there's an anticipation of a transition towards comprehensive price adjustments across the distribution chain.

Anticipated revival in demand for steel sheet products, particularly thin sheets, is on the horizon as production resumes in the automobile sector. This resurgence is expected to inject vitality into market inventory movements.