Japan Raw Steel Output to Rise to 118.8 million tonnes in F2008, JISF

Japanese raw steel output will increase by 800,000 tonnes to 118.8 million tonnes in fiscal 2008 starting April 2008 from estimate in fiscal 2007, announced by Japan Iron and Steel Federation on Thursday. The federation expects the domestic demand increases for manufacturers while the export decreases when China increases the output and US economy slows down along with higher oil price. The output could reach record 120 million tonnes after the output in fiscal 2007 tops second high in fiscal 2006. The output will keep more than 110 million tonnes for 6 years in a row since fiscal 2003. The federation expects the carbon steel domestic demand decreases in fiscal 2007 from fiscal 2006 when the building start drops sharply with confusion caused by new building standard law while the demand keeps firm for manufacturers including automobile, shipbuilding, industrial and electronic machinery. The special steel demand increases thanks to high level automobile output. The steel export increases due to the major destination of Asian economy keeps firm. The raw steel output increases by 300,000 tonnes to 118 million tonnes. The federation expects the carbon steel domestic demand increases in fiscal 2008 from fiscal 2007. The firm demand for manufactures lifts the total demand despite of the slower building activity. The special steel demand also keeps high level. The export decreases due to higher output by China, higher oil price and slower US economy. The federation expects Japanese steel market could keep firm with offshore demand driver while the steel market could phase potential risk including slower US economy, higher oil price and fluctuation of foreign exchange rate. The federation expects Japanese economy will grow by 1.8% in fiscal 2008 from fiscal 2007, which is estimated to be 1.3% growth.