Osaka-based Kyoei Steel, Japan's largest rebar producer, has decided to keep its prices for rebars unchanged for January, saying on Friday that the long steel product market currently is in a difficult environment due to seasonal factors, with the year-end slowdown causing inquiries and cargo movements to remain sluggish.
"However, we will continue to work to spread the price increase so far into the market, and according to the situation, will also consider raising prices during the month," the company said in a statement.
Back in early September, Kyoei had lifted its rebar prices at varying times at its four works nationwide by a total of Yen 7,000/tonne ($49/t), and early this month it raised prices of flat bars, equal angles and other items made at its Yamaguchi plant in western Japan by Yen 3,000/t from December 7, as Mysteel Global reported.
At the time, market watchers suggested that Kyoei might be testing to see whether the market was ready for a further rise but evidently, it decided not to try. "The correction of product market conditions is sufficient amid the sluggish demand," it noted Friday, adding that "we will strengthen our efforts" to make sure the price hikes take hold.
It warned too that during the year-end period and Japanese Oshogatsu (New Year) holidays it would stop its furnaces for longer "to adjust production".
In a market commentary on Monday, industry daily Tekko Shimbun had noted that the price hikes announced by Kyoei Steel, Osaka Steel and others in early autumn have met strong resistance. "In the business of pre-sale rebars, it is impossible to get rid of the low price," it said. "Looking at demand, construction starts on new small and medium-sized buildings continue to be delayed and there is little good news for the future," it added. The price of ready-mixed concrete is also scheduled to increase next spring, so the market environment will become even more severe, it warned.
Kyoei's decision to hold prices follows that of market leader Tokyo Steel Manufacturing which on Monday had announced that it would be holding all its prices for January contracts,
as reported. Kyoei never reveals its prices but Tokyo Steel's list price for 13-25mm diameter rebar remains at Yen 82,000/t.