Japan’s steel demand including both carbon and special may rise 7.3% on quarter for the quarter of January-March 2021 to 23.5 million tonnes, according to the latest forecast by Japan’s Ministry of Economy, Trade and Industry (METI), which suggests that the Japanese steel producers will probably ramp up output further to match the growing consumption.
The anticipated volume, though, will still be 2.5% lower on year due to the remaining negative impact of the COVID-19, though some end-users will see their consumption improve steadily and gradually on quarter with the continuing recovery in their operations, according to the release.
As for Japan’s crude steel production, METI expects the volume for the fiscal 2020 (April 2020-March 2021) to around 82.5 million tonnes, 16.2% lower on year, which is slightly higher than the 81-82 million tonnes forecasted by the Japan Iron & Steel Federation earlier on, Mysteel Global noted.
As for the domestic demand in finished steel will decline by 1.5% on year and 2.3% lower on quarter to 13.95 million tonnes in the January-March quarter, among which finished carbon steel demand from Japan’s key consuming sectors will decline both on year and on quarter, with that from the construction sector expected to drop 6.8% on year and down 6.1% on quarter to about 4.5 million tonnes, and consumption from the manufacturers may drop 1% on year and down 1.9% on quarter to 6.2 million tonnes while those for exports are expected to drop 8.5% on year but up 9.3% on month, according to the data.
As for the country’s steel exports including both carbon and special steel, it may decrease 7.3% on year but up 10.7% on quarter to 6.7 million tonnes mainly due to the growing demand from the overseas market but relatively limited supplies from the domestic steel producers.
Japan’s finished steel demand forecast (Jan-Mar)
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|
Finished products total | Carbon steel | Special steel |
| Total (mn t) | 20.64 | 16.11 | 4.53 |
| Y-o-Y | -3.4% | -5.4% | 4.3% |
| Q-o-Q | 1.6% | 0.4% | 5.9% |
| Domestic Demand (mn t) | 13.95 | 10.71 | 3.24 |
| Y-o-Y | -1.5% | -3.7% | 6.8% |
| Q-o-Q | -2.3% | -3.5% | 2.1% |
| Exports (mn t) | 6.69 | 5.4 | 1.29 |
| Y-o-Y | -7.3% | -8.5% | -1.7% |
| Q-o-Q | 10.7% | 9.3% | 16.7% |
Source: METI
A trader in Tokyo agreed on the lower on-quarter steel exports, as the Japanese mills will still prioritize the domestic long-term contract buyers such as auto related customers. “Japan mainly exports hot-rolled coils, but the supply of flat steel has been in general rather tight, so I doubt the Japanese steel mills will have much extra tonnage for the overseas customers,” he added.
However, if Nippon Steel reignites its banked furnace at Kashima area of East Nippon Works in late January as planned, which may ease the supply tightness, he added.
Written by Yoko Manabe, yoko.manabe@mysteel.com
This article has been published under an article exchange agreement between Mysteel Global and SteelMint.
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