Nippon Steel holds H-beam prices as dealer stocks dip

"The supply-demand balance is improving, but both operating rates and inventory levels remain high, making (the market) unpredictable," the company said. To "optimize the supply-demand balance," Nippon Steel will continue to limit the number of orders it will accept to 50% of those it had accepted last December, a policy it has observed for eight consecutive months, albeit without any sizeable impact on market trends.

Nippon Steel never reveals its prices but rival sections maker Tokyo Steel Manufacturing, Japan's largest independent mini-mill, had announced last week it was holding prices of all its products unchanged for a second month after lifting them for July sales by Yen 2,000-3,000/t, as Mysteel Global reported. Consequently, its price for SS400 grade 100x200mm H-beams is still at Yen 116,000/t.

Meanwhile, Yamato Steel, a mini-mill located in Himeji in western Japan, is also holding its selling prices for H-beams, I-beams and sheet piles unchanged for September.

"Domestic construction demand remains sluggish due to declining construction capacity and persistently high construction costs," the company said.

"Large projects are starting to move forward, but small and medium-sized projects are slowing down. Additionally, uncertainties such as the situation in the Middle East remain, making the outlook highly uncertain," it admitted. Yamato will be suspending all steelmaking and rolling operations for scheduled maintenance from September 30 to October 10, it said.

Data for construction starts nationwide during June released by Japan's Ministry of Land, Infrastructure, Transport and Tourism (MLIT) show that total starts on all public and private buildings reached 8.34 million square metres, higher by 13% on year and making for the second straight on-year increase.

Within the total, starts on steel frame structures in June increased by 11.5% on year to 2.97 million sq m but the rise hardly offset the cumulative 37.2% decline recorded for April and May, the MLIT numbers show.

The dip in H-beam stocks Nippon Steel had noted was in those held by its Tokiwakai grouping of domestic H-beam traders and dealers nationwide. By end-July, their stocks had totaled 207,600 tonnes, lower by 7,900 tonnes from end-June and making for the fifth on-month decline since the end-March peak of 228,300 tonnes.

"While inbound volumes remained low, shipments increased, leading to a decrease in inventory," Nippon Steel observed. Deliveries from mills to the dealers' yards declined by 900 tonnes, or 1.5%, from June to 60,600 tonnes, while outbound shipments increased by 3,500 tonnes, or 5.3%, to 68,500 tonnes, the Tokiwakai statistics show.

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

Edited by Alyssa Ren, rentingting@mysteel.com