Japan's prices of carbon flats rise slowly on producers' hikes

As of June 29, prices of carbon steel hot-rolled (HR) and cold-rolled (CR) sheets in Japan's spot market had risen by Yen 2,000/tonne ($14.7/t) on month over the previous hikes by producers, though actual sales remained sluggish, according to sources.

On Wednesday morning, deals for SS400 grade 1.6mm thick HR cut sheet (1,219×2,438mm) were transacted in Tokyo at Yen 131,000-133,000/t, and those for SPCC grade 1mm thick CR cut sheet (914×1,829mm) were at Yen 135,000-147,000/t, both up Yen 2,000/t on month, sources confirmed.

A Tokyo-based flat steel trader explained domestic distributors and coil centers had been trying to transfer the previous hikes by producers, but demand remained stagnated, and the price increment was narrow.

Nippon Steel, Japan's largest integrated mill had lifted its flat prices for domestic spot sales by a total of Yen 30,000/t for April-May sales. And JFE Steel, Japan's second-largest integrated mill, had added over Yen 40,000/t for April-June sales, both to transfer the rise in production costs, as reported.

A distributor in Tokyo observed that Japanese integrated mills had been lifting prices, but Tokyo Steel Manufacturing, Japan's leading electric-arc-furnace (EAF) steel producer, had been holding its flat product prices. "Different price policies by producers may make customers step back from buying to monitor the movement," he said.

Tokyo Steel decided to keep its carbon steel product prices including both flats and longs for June and July sales unchanged, after it had lifted a total of Yen 13,000/t for March-May sales, as reported.

The distributor emphasized that flat stocks need to be adjusted lower somehow and it will be the only factor to make prices rise. "We doubt whether Japanese manufacturers would lift their flat consumption soon, because delays in component deliveries continued. So only can suppliers adjust their stocks lower," he added.

The latest data from Japan Iron & Steel Federation showed the country produced 15.67 tonnes of HRC in total over January-May, down 4.3% on year.

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

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