After a sharp decline in its local steel prices for April, leading Japanese EAF-based steelmaker Tokyo Steel decided to maintain its steel prices unchanged for May despite a visible decrease in local demand due to the spread of Covid-19. At the same time, the downtrend in the export market has already hit bottom and will rebound, the company believes.
Tokyo Steel’s rebar and H-beam prices have remained at JPY 55,000/mt ($510/mt) ex-works and JPY 76,000/mt ($705/mt) ex-works, respectively. Prices for HRC with thickness above 1.7 mm are at JPY 62,000/mt ($575/mt) ex-works, after the sharp drop of JPY 5,000/mt ($46/mt) last month.
Construction steel demand in Japan has been hit hard as on April 7 the government imposed a state of emergency in seven prefectures, including Tokyo, and then on April 16 it was expanded for the whole country. Also, Tokyo Steel said that, in the flat steel market, consumption has dropped as well due to the stoppages of automakers, who have faced disruptions in the supply chains and weak demand.
According to Tokyo Steel, overseas prices have fallen sharply, but, since they have fallen to a level below the profitability of manufacturers, it seems that the market has bottomed out.