Japan Plate Demand to Keep 6.3 Million T in 2H F2010

Japanese plate demand will be 6.3 million tonnes in second half of fiscal 2010 ending Mach 2011 as the first half. The demand is expected to increase from originally expected around 6 million tonnes in the first half due to firmer demand for shipbuilding and construction machinery than expected. Japanese integrated steel makers and plate industry interests expect the demand could keep high in the second half while the domestic demand could slow.

The domestic demand will be 4.7 million tonnes in the first half and the level or slightly low in the second half. The shipbuilding demand is around 2.5 million tonnes in the first half when the construction increases more than expects along with new order recovery. However, some of Japanese steel makers expect the shipbuilding demand could decrease in the second half due to lower steel consumption for each vessels and higher plate inventory at shipbuilders.

The demand for construction and industrial machinery is expected to be around 700,000 tonnes in the second half as the first half. The machinery makers’ production increased to meet growing demand in China and Asia in the first half. However, their production could slow in the second half due to slowing economy and overstock in China.

The demand for steel structural building and bridge is expected to be flat or slightly lower in the second half compared with around 700,000 tonnes in the first half. The demand is firm for major building projects while some watchers expect the demand could decrease to 640,000-650,000 tonnes level in the second half due to lower building and bridge demand.

The export will keep firm in the second half as the first half with 1.6 million tonnes. The largest buyer of South Korean shipbuilders could increase the plate purchase in the second half from the first half, when they reduced the purchase to avoid high priced plate purchase.

Japanese plate demand recovered the level after the total demand decreased to around 5.3 million tonnes in first half of fiscal 2009 from 7 million tonnes in first half of fiscal 2008. The demand could keep 6 million tonnes per half year due to limited growth room for domestic consumption.