Japan Oct-Dec steel output seen down 4 pct yr/yr

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

30 Sep 2009

Japan's crude steel output is set to recover in the October-December quarter to near its year-earlier level, thanks to a pick up in the auto and construction sectors, the trade ministry said on Tuesday. Japanese steelmakers, including the world's No.2 Nippon Steel Corp and No.5 JFE Holdings Inc, have been increasing production as the industry pulls out of its worst slump in decades thanks to improving exports to China and other Asian countries.
Automakers are also increasing their orders for steel as government stimulus measures help car sales.
Crude steel output is expected to fall 4.2 percent to 25.28 million tonnes during the quarter from a year earlier, the ministry said. But it would be up 3.7 percent from the preceding quarter.
Battered by the global financial crisis, Japanese crude steel output plunged 43 percent from a year earlier in January-March and 39 percent year-on-year in April-June.
The ministry expects steel demand from carmakers will almost recover to a year-earlier level in the October-December quarter, while demand from the construction and engineering sectors will show a sharp improvement as government stimulus measure filter down to the sector.
But the ministry said the longer-term outlook remains cloudy.
'The outlook for the export market and the government's stimulus measures remains uncertain,' said Masaki Koito, a director at the ministry.
'Possible oversupply in Asia adds to that concern,' he said, citing Chinese and some Asian countries' plans to increase production capacity.
Demand for steel from construction companies and manufacturers in October-December is seen totalling 19.48 million tonnes, down 0.1 percent from a year earlier but up 5 percent from the prior quarter, the ministry said.

Source: Reuters