Japan Steel Column Demand to Hit Historical Low in F2009

Japanese demand of large diameter square pipe or column is expected to decrease well less than 400,000 tonnes in fiscal 2009 ending March 2010, according to major column maker. The maker expects the demand will decrease to around 350,000 tonnes, which is around 25% lower than fiscal 2008. The firm concerns the demand could keep slow through late 2009 while the demand recovers slightly from bottom in April-June.

The maker expected the demand would be around 460,000 tonnes for fiscal 2009 as of April. The firm revised the demand downward to around 400,000 tonnes in May when the demand was very slow in April-June. The firm now revised the demand again downward due to slow demand in private sector.

The demand is estimated to be just less than 70,000 tonnes in April-June, which is around half of the demand in same period of 2008. The demand is expected to be around 80,000 tonnes in July-September, which is around 45% lower than same period of 2008. The major maker expects the demand is as low as around 200,000 tonnes in October 2009-March 2010. The maker expects construction industry would recover after better demand lifts manufacturers’ operation rate.

Column market price is around 40,000 yen per tonne higher than H-beam. The higher price could encourage the users to shift to H-beam and other materials reducing column demand additionally.