Nippon Steel, Japan’s largest integrated steel maker, has decided to add Yen 15,000/tonne ($136/t) onto its commercial-grade heavy plate by for spot sales in July in the context of rising input costs and tightening in supply, a company official confirmed on June 30.
“We will have to raise the prices for stable production, and we may have to increase prices further in the coming months,” she commented. The July price rise is after the increment by Yen 10,000/t in May, and so far, Nippon Steel has raised its plate price by a total of Yen 35,000/t so far in 2021, Mysteel Global noted.
The Nippon Steel official was unable to specify the exact plate price hikes to the long-term deal customers, as it is individually negotiated, though the degrees will be more or less the same, according to her.
Nippon Steel does not reveal its exact list prices for spot sales, and as of June 30, the SS400 grade 19mm thick (1,524×3,048 mm cut) heavy plate is transacted at Yen 108,000-111,000/tonne in the spot market in Tokyo, up Yen 1,000/t from last Friday and Yen 12,000/t higher on month, sources confirmed.
A Tokyo-based distributor expressed little surprise at Nippon Steel’s decision, sharing that inquiries on plate have been very active in the spot market, enabling distributors to be selective in orders. “Spot plate prices may be up further, and we should be making the best of the timing to digest the producers’ price hikes by asking customers to pay higher,” he added.
A Tokyo-based trader agreed, noting that plate supply has been tightening in Japan and globally in June, and overseas suppliers have already notified their Japanese buyers of substantial price hikes and lower export volumes.
South Korea’s Posco and Taiwan’s China Steel Corp (CSC), both being major plate suppliers to Japan, will raise their plate prices substantially for August-October shipments, and CSC will also reduce the supply volume during the few months to prioritize domestic sales, as reported.
As for demand, consumption from Japan’s long-term contract customers such as construction machinery manufacturers is expected to stay firm, as export orders have been robust and the country’s construction sector may expand further with projects already in the pipeline during the second half of FY21 (October-March 2022), according to market sources.
“New vessel orders have picked up too though still slowly, all these have encouraged producers to raise their prices,” the Tokyo trader added, and “plate supplies will not increase much as the Japan’s integrated mills have prioritized hot metal supply to hot-rolled coils, so nothing much for other products,” he predicted.
Japan produced 757,100 tonnes of plate in May, up 8.2% on year and 5.4% higher on month, according to the latest data by the 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.
Leave a Reply