Three Major Japan Steelmakers Log Net Profit Falls in FY 2007

News was prepared under the information support of Online Daily Newspaper on Hellenic and international Shipping "Hellenic Shipping News".

29 Apr 2008

Three of Japan's four major steelmakers posted falls in group net profits in fiscal 2007 under the weight of rising material costs. The three are JFE Holdings Inc., Kobe Steel Ltd. and Sumitomo Metal Industries Ltd. Industry leader Nippon Steel Corp. posted a 1.1 pct rise in net profit in the year that ended in March. Meanwhile, all four steelmakers posted increases in sales on the back of robust demand from large-lot users such as automakers and shipbuilders.
In the year, they successfully reflected rises in the prices of iron ore and other materials in their product prices. The average steel price at Nippon Steel rose 4,500 yen from the previous year to 79,800 yen per ton, and the average price was up 5,700 yen at 105,700 yen at Sumitomo Metal.
For the year to March 2009, Nippon Steel, Kobe Steel and Sumitomo Metal project sharp net profit falls due to surging procurement costs for such materials as coking coal.
The Japanese steelmaking industry's total costs in the current year are expected to increase by more than 3 trillion yen from fiscal 2007, and the major steelmakers thus see the need to raise their product prices by at least 30,000 tons per ton.
But it remains to be seen whether large-lot users will accept such a large price hike, according to industry sources.
Against this backdrop, JFE did not disclose its earnings estimates for fiscal 2008.

Source: japan Corp