Japan's carbon steel flat stocks down 3% m-o-m in June

By the end of June, inventories of key flat-rolled carbon steel products held by Japanese steel producers, coil centers and distributors nationwide approximated 4.52 million tonnes, down 3% on month, according to the latest data from Nippon Steel.

Market sources attributed the decline mainly to the fact that there were more business days in June, but they also anticipated the further decline in coming months with improved operations by manufacturers.

However, the total stocks including hot-rolled (HR), cold-rolled (CR) and coated coils and sheets were still 16.5% higher on year, or having persisted above 4 million tonnes for the 11th month, according to the company data.

A steel trader in Tokyo observed that June stocks would usually decline because of slower deliveries in May with long holidays. "Some manufacturers seem to have been lifting their operations since late July, so we expect the stocks to decline that month," he predicted.

"But operations by automakers - the largest flat steel consumer - are still slower than expected due to the delay in component deliveries, so we won't expect any sharp decline in flat stocks in coming months," he added.

A second trader in Tokyo also expected the decline in coming months, adding that producers have been adjusting their supply volumes as a priority, which will lead the stocks to become thinner.

"But arrivals of imported flat products might remain at high levels, and may impact the stock level. So we need to monitor the movement carefully," he warned.

In June, Japan imported a total of 276,521 tonnes of HRC, CRC and galvanized sheets, up 7.2% on month and 17.3% higher on year, Mysteel Global calculated based on the latest data released by Japan Iron & Steel Federation.

Written by Yoko Manabe, yoko.manabe@mysteel.com
This article has been published under an article exchange agreement between Mysteel Global and SteelMint.