Japan Construction Demand to Keep Firm, Industry Official

Nippon Steel’s director Uchida Junji said to business press the domestic steel demand will keep firm for construction sector for second half year to March 2007. He expects the demand is firm mainly for private sectors’ capital expenditure despite of the risk factors including high crude oil price and potential slowdown of US economy. Mr. Uchida expects the steel demand is more than 7.3 million tonnes for steel structural buildings in fiscal 2006 ending March 2007, which is slightly higher than fiscal 2005. He expects press forming column demand will increase to record 200,000 tonnes while H-beam demand keeps the high level. He indicates potential price hike for construction steel products depending on cost and market condition. Mr. Uchida said the construction steel products committee of Japan Iron and Steel Federation will make guideline for construction application to improve the quality management for distributors, processors and construction industry. The move is to focus on quality issue for construction steel items after Japan Industrial Standard reform in October 2005 results in wider variation in component and sizes for the steel products.