Japan Steel Consumption to Increase by 1M tonnes to 61M tonnes in F2011

Japanese steel consumption is expected to increase by 1 million tonnes to 61 million tonnes in fiscal 2011 ending in March 2012 from fiscal 2010. The consumption is expected to be 28.5 million tonnes for first half of fiscal 2011 when industry’s production activity grew stagnant due to mega earthquake, but the consumption increases by 4 million tonnes to 32.5 million tonnes in the last half of fiscal 2011 from the first half. There is much cause for worry such as high yen exchange rate, political upheaval, anti-inflation policy in emerging countries, financial turmoil in Europe and U.S. However, Japanese integrated steel makers and special steel makers will increase output for mainly manufacturing industry.

Japanese steel consumption decreased by 5% to 14.3 million tonnes for January-March from the same period of last year due to automobile output reduction and is expected to decrease by 9% to 13.4 million tonnes for April-June.

Japanese completed car output decreased by 25% to 1.91 million units for January-March from same period of last year and by 33% to 1.54 million units for April-June. The output is rapidly recovering in recent days and is forecasted to be about 2.4 million units for July-September, which is same as first half of fiscal 2010. In the last half of fiscal 2011, the output would increase to more than 5.5 million units and industry sources see the output could increase to 5.7 million units.

The steel consumption is expected to recover to slightly more than 15 million tonnes for July-September due to car output increase despite of unchanged demand for construction, shipbuilding, industrial machinery and electric appliance.

The consumption is expected to be 16 million tonnes for October-December and 1.65 million tonnes for January-March 2012 when the demand starts increasing for restoring from disaster of earthquake in the last half of fiscal 2011.

The consumption had been continued increasing since 70 million tonnes in fiscal 2003 and reached 80 million tonnes in fiscal 2006 and 2007, while the output dropped to 70 million tonnes in fiscal 2008 and to 58 million tonnes in fiscal 2009 due to global recession. The consumption stayed at 60 million tonnes in fiscal 2010 due to aftermath of earthquake.