Japan Major Special Steel Makers Expect Low Demand in F2009

Daido Steel expects the steel sales is 860,000 tonnes in fiscal 2009 started April, which is around 25% lower than 1.137 million tonnes in fiscal 2008. Aichi Steel plans to make 770,000 tonnes of steel products in fiscal 2009, which is much lower than 1.2 million tonnes in fiscal 2008. The special steel makers’ operation could keep low level due to very slow automobile demand.

Daido Steel expects the sales volume is 350,000 tonnes in the first half of fiscal 2009, which is almost half of 710,000 tonnes in same period of fiscal 2008. The firm expects the sales will increase in and after July-September from the bottom in April-June. The firm estimates the sales will be 510,000 tonnes in the second half, which is more than 20% higher than 420,000 tonnes in the same period of fiscal 2008.

Aichi Steel reduced the steel production in second half of fiscal 2008 when the major user of Toyota Motor reduced the production widely under worldwide recession since late 2008. Aichi Steel’s steel production decreased to less than 1 million tonnes at 970,000 tonnes in fiscal 2008, which was around 20% lower than fiscal 2007.

Aichi Steel expects the production decreases in fiscal 2009 from the low level of fiscal 2008 when the production is very low level at the start of the year. The firm expects the demand recovery is slow while the demand already hit bottom when Toyota Motor increases the daily production and is expected to increase the production more. Aichi Steel expects the higher volume contributes to the breakeven in the second half after loss making first half year.