Japan Steel Demand to Rise by 2.5% in Oct-Dec

Japanese steel demand will increase by 2.5% to 27.31 million tonnes in October-December from same period of 2007, announced by Ministry of Economy, Trade and Industry on Monday. The demand represents 30.34 million tonnes of raw steel output, which is 1.7% lower than same period of 2007 due to 290,000 tonnes of inventory liquidation under higher stock for sheet steel. The demand increases marginally for construction along with firm demand for manufacturers including automobile, shipbuilding and industrial machinery. The raw steel output could decrease in October-December from same period of 2007 for the first time in 12 quarters while the output level would keep more than 30 million tonnes for 5 quarters in a row. The demand increases for construction including civil works and major building projects in October-December while the building demand decreases generally due to slower construction activity for condominium. The shipbuilding demand keeps firm and the automobile demand is in line with same period of 2007. The steel export will decrease under slower demand for the international market. METI warns the higher steel inventory, especially for hot, cold and coated sheet steel. METI expects the carbon steel inventory decreases by 270,000 tonnes at end of December from estimated 6.3 million tonnes held by makers and distributors at end of September. The ministry also warns the steel makers should be cautious to potential impact from financial crisis in USA.