By August 19, Japanese rebar prices in Tokyo market had remained unchanged for over three months, though scrap prices had declined largely. But market sources are expecting buyers to stop asking for lower prices with Japanese scrap prices bottoming out lately.
As of Friday morning, deals for SD295A 16-25mm rebars in Tokyo were being transacted at Yen 121,000-123,000/tonne ($889-903/t), unchanged since late April after it had been lifted by around Yen 25,000/t since January, according to sources.
A Tokyo-based distributor shared that inquiries for rebars prior to Japan’s two holidays (on August 11 and over August 13-15) had been stalled, and some buyers were asking for lower prices with declined scrap prices.
But distributors had tried to keep their prices settled because rebar makers were claiming the rise in other costs. “So rebar prices had been kept flat, though we can’t rule out the possibility of price declining,” he explained.
“But Japanese scrap prices seemed to have bottomed out this week, and mini-mills in the Kanto region around Tokyo had been lifting their scrap buying prices. So we expect that no distributors would agree on any lower prices, and we don’t think that rebar prices will drop, though the price rise will largely depend on the range of scrap price increment,” he predicted.
Tokyo Steel Manufacturing, Japan’s leading mini-mill, has started lifting its scrap buying prices by Yen 1,000-3,000/t effective from Friday arrivals at its three works, marking the first rise in about four months, as reported.
A Japanese construction steel trader noted that many rebar buyers were stepping back over the anticipation of price fall in tandem with the decline in scrap prices. But Japanese scrap prices had bottomed out, and buyers need to start booking materials for their use in the second half of the current fiscal year (October-March 2023).
“We expect that buyers will become active to secure materials soon. And if scrap prices keep rising, buyers will quicken their pace in securing the volume,” he said.
Kyoei Steel, Japan’s largest rebar producer will release its rebar prices for September sales in the next week. And market participants are waiting for the company’s price policy to find a clear indication.
Written by Yoko Manabe, yoko.manabe@mysteel.com
This article has been published under an article exchange agreement between Mysteel Global and SteelMint.
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