Japan's Tokyo Steel Announces Steep Price Cut for Apr

Japan's leading electric-arc steel manufacturer -Tokyo Steel is likely to cut its steel prices by Yen 5000-9000/MT ( USD 47- 84/MT) for Apr'20 deliveries. This is the first cut made in the past six months on spread of Coronavirus which resulted in bearish sentiments in the domestic and overseas market. The quantum of the price cut made ranges across 6-11%.

-- Prices for H-shaped beams stood at Yen 76,000/MT (USD 715) and for deformed steel bars (re-bars) revised offer stand at Yen 55,000/MT (USD 517) for April delivery. Prices of hot-dip galvanized coils will be cut by Yen 5,000/MT while that of channels will go down by Yen 9,000/MT.

-- Mr Imamura, MD Tokyo Steel said, "Uncertainty is sweeping the steel industry as economic activities have slowed in the wake of the coronavirus outbreak. We've decided to slash prices to meet the weak market conditions although actual demand has not fallen as much as people fear."

-- Domestic inventories have increased and depreciation of the US dollar against the Yen will provide enough room for cheaper imports from neighbouring nations which in turn shall impact domestic prices in the near term.

-- In addition to this Tokyo Olympics 2020 and few construction projects have been delayed. Along with this slowdown in tourism sector amid coronavirus outbreak will hurt the Japanese economy. This will lead to a decline in Japanese steel prices in the near term.

Tokyo steel scrap purchase prices-

-- Japan's leading EAF mini-mill, Tokyo Steel has made three price cuts in scrap purchase so far in Mar'20.

-- The company is paying JPY 18,000/MT for H2 scrap delivered to its Kyushu works in the western region. For H2 scrap delivered to Tahara plant in the central region, Utsunomiya works located in the Kanto region, Okayama plant and Takamatsu Steel Center the prices remain unchanged at JPY 20,500/MT, JPY 19,500/MT, JPY 19,000/MT, and JPY 18,000/MT levels respectively.