High Yen Rate Results in Lower Japan Steel Export, Higher Import in 2011

Japanese steel export decreased by 5.0% to 40.858 million tonnes in 2011 from 2010, which decreased for the first time in 2 years, announced by Ministry of Finance on Wednesday. The export was impacted by slower steel users’ activity due to the major earthquake and Thai flood along with historical high yen rate. The steel import increased by 15.2% to 7.977 million tonnes, which increased for 2 years in a row. The import represented around 10% of the domestic demand, which was recent high. The high yen rate impacted on Japanese steel industry. The trade situation would be severe in 2012 due to European crisis and slower Chinese growth.

The export to Asia, which represented 80% of total export, decreased by 7.9% to 32.955 million tonnes in 2011 from 2010. The export decreased by 15.8% to 13.575 million tonnes to Asian Newly Industrialized Economies. The export decreased especially to South Korea with major expansion. The export to China decreased by 8.2% to 6.817 million tonnes under slower demand due to the inflation fight by the government. The export decreased by 0.8% to 11.211 million tonnes for Association of Southeast Asian Nations due to strong export through October 2011.

Japanese export hit record 43.395 million tonnes in 2010 thanks to rapid demand growth in emerging countries while the export level was annual 35 million tonnes level in 2000s. The export in 2011 represented 38% of raw steel output, which was 1.2 percentage points lower than 2010 level.

The import increased by 29.0% to 4.529 million tonnes from South Korea and Asian NIES in 2011 from 2010. The import from China increased by 1.4% to 1.326 million tonnes. Japanese import hit record 13.836 million tonnes in 1991. The import was recent peak of 8.664 million tonnes in 2007.

The export decreased by 15.4% to 3.097 million tonnes in December from a year earlier, which decreased for 10 months in a row. The export increased by 2.4% from November but the volume was 8.0% lower than October after when Thai flood impacted on the export. The import increased by 30.2% to 719,227 tonnes from a year earlier, which increased for 8 months in a row. The import decreased by 5.6% from November, which decreased for 2 months in a row.

The averaged export price was FOB 92,663 yen per tonne in December, which was 2.5% higher than November level. The price increased for 2 months in a row under recovering international market. The import price decreased by 4.3% to CIF 117,198 yen, which decreased for the first time in 2 months.