Tokyo Steel prices cut,H-beam down Y2,000/T

Mon Aug 22, 2011

* Second price cut this year to fend off imports
* Price cut slightly smaller than market expected

TOKYO Aug 22 (Reuters) - Tokyo Steel Manufacturing Co , Japan's biggest construction steel maker, said on Monday it will cut product prices for the second time this year as the yen's rise has opened up a big price gap between domestic products and imports.

The company will cut prices by 2,000-4,000 yen ($26-52) per tonne for September, or 2 to 5 percent, its second across-the-board price cut in three months.

The price cut was slightly smaller than the market expectations of around 3,000-5,000 yen.

"There are signs of a pickup in demand as carmakers are ramping up production and large development projects in the Tokyo area are about to start," Tokyo Steel director Naoto Ohori told a news conference. "We need to head off imports to tap this demand."

The company cut its price for H-beams, a key product used in construction, by 2.6 percent to 74,000 yen ($971) per tonne from 76,000 yen, after keeping prices unchanged for three months.

Japan's imports of steel products, mostly hot- and cold-rolled coils, rose in June to an almost six-year high of 420,000 tonnes. China's steel exports exceeded 4 million tonnes for the fourth straight month in June as domestic demand slowed, causing an oversupply in Asian markets. South Korea is also boosting exports.

Tokyo Steel's move is in contrast with Asia' other big exporters, which are beginning to raise prices to offset high input costs.

Baoshan Iron & Steel Co Ltd , China's top listed steelmaker, said this month it will raise prices of its main products for September bookings, in anticipation that demand will pick up in the peak consumption season.

Nippon Steel Corp , Japan's top maker of H-beams, is currently operating at 30 percent of its H-beam capacity in an attempt to tighten the market.

The company this month said its inventories of H-beam steel for spot customers fell 4.2 percent to 206,300 tonnes at the end of July, the first decrease in seven months but still at a high level. ($1 = 76.245 Japanese Yen)

(sourced Reuters)