Japan Major 4 Stainless Makers Post Profit in April-June

Japanese major 4 stainless steel makers secured recurring profit for April-June while Nippon Steel & Sumikin Stainless Steel (NSSC) posted loss, according to Japanese 5 major stainless makers’ results announced by Friday. Their shipment decreased from same period of 2010. Nippon Yakin Kogyo and Nippon Metal Industry expect higher recurring profit for fiscal 2011 ending March 2012 from fiscal 2010 while Nisshin Steel and Nippon Kinzoku expect lower full year profit.

The makers try to secure profit by reducing cost at the operations and expanding high valued products when the domestic demand is slow mainly for construction market and the international price competition gets severer.

Nissin Steel announced on Friday the parent company’s stainless raw steel output was 140,000 tonnes in April-June as same period of 2010 while the sales volume decreased by 10,000 tonnes to 120,000 tonnes. The firm expects 160,000 tonnes of raw steel output and 130,000 tonnes of sales in July-September.

Nippon Metal Industry posted 23.3% higher recurring profit for April-June from same period of 2010 while the sales decreased by 9.7%. The profit increased due to higher margin by increasing original products including precision rolled products.

The stainless majors launch offshore new plants and sales operations in July-September. Nisshin Steel expects Malaysian cold rolling joint venture with Acerinox of Spain in July-September. Nippon Metal Industry establishes Thai sales joint venture for precision rolled products. Nippon Kinzoku shifts the processed steel business to Thai cold finished steel plant. Nippon Yakin Kogyo expands high performance products for energy and environmental industry in China by expanding the sales operation in Shanghai.

The makers try to follow growing demand in Asia and offshore countries when the domestic demand is very slow. Their profitability depends heavily on the offshore business under high yen rate.