Japan’s machinery orders for all industrial uses rose 10.8% on year to Yen 378.2 billion ($2.8 billion) in value, or the second consecutive month with an on-year rise, according to the latest release by Japan Society of Industrial Machinery Manufacturers on June 14. Market sources believed the result indicated stable steel demand from Japanese machinery sector.
Although the April result was 47% lower on month, sources said orders would usually decline in April with active sales activities in March – the last month of the fiscal year, so the on-month decline was of little concern.
“The on-year drop since April 2021 was only seen in August and March, so we basically understand demand of industrial machinery is firm and steel consumption by the sector will stay stable,” a steel trader predicted.
Among the total, orders from Japanese customers approximated Yen 240.8 billion, up 3.8% on year, among which Yen 97.9 billion were from domestic manufacturers, 26.1% higher on year, and those from non-manufacturers were at Yen 51.2 billion, down 24.9% on year.
The trader heard negotiations between Japanese machinery makers and non-manufacturers buyers had been increasing. “So we expect total machinery orders from domestic buyers to rise further,” he said.
As for Japan’s industrial machinery exports in April, those rose by 25.7% on year to Yen 137.3 billion.
A sales official from a machinery maker in Tokyo said he was concerned about the decline in orders from Russia because of the ongoing conflict with Ukraine and the past COVID lockdown in Shanghai. “But overall orders from Asian countries remained active, so Japan’s total export orders didn’t decline,” he said.
In April, Russia and East European countries ordered Yen 880 million in value of Japanese machinery, down 95.5% on year, while those from Asian countries grew by 41.4% on year to Yen 82.2 billion, according to the official data.
Over January-March, Japan’s carbon steel and special steel orders placed by domestic industrial machinery manufacturers totaled 750,425 tonnes, down 4.9% on year, Mysteel Global calculated based on the latest data by Japan Iron & Steel Federation.
Written by Yoko Manabe, yoko.manabe@mysteel.com
Note: This article has been published in accordance with an article exchange agreement between Mysteel Global and SteelMint.
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