METI: Japan's crude steel output to rise 4.4% this quarter
Though the total would mark the first increase in two quarters and be the highest quarterly result since April-June last year, it would still put calendar 2023 output at just 87.75 million tonnes, lower by 1.7% from last year and making for the second consecutive yearly decline, Mysteel Global notes.
In terms of finished steel output, production of ordinary steel will reach 15.12 million tonnes this quarter, up 2.2% on year, while that of special steel will be 1.8% lower from October-December last year at 4.05 million tonnes, according to METI's forecast. In parallel, finished steel production for domestic sales will total 12.49 million tonnes this quarter, up 1.9% on year, while that of steel for export will rise by a smaller 0.4% on year to 6.68 million tonnes.
"We can expect a steady recovery in (demand from) the automotive sector, though the construction field will remain sluggish due to the impact of the extension or cancellation of construction periods of large-scale projects," according to a METI official. "The export market, including for automobiles, is weak," industry daily Tekko Shimbun quotes him as saying.
The ministry's caution about construction steel demand is borne out by its prediction that H-beam production this quarter will rise by 90,000 tonnes from July-September to reach 870,000 tonnes but that of small bars including rebars will decline by 30,000 tonnes on quarter to 1.76 million tonnes. The autumn months of October-December are usually the peak months for construction steel usage in Japan, Mysteel Global notes.
Commenting about current market conditions, Nippon Steel' executive vice president Takashi Hirose remarked last Friday that while the domestic market remains on a gradual recovery, "the construction sector is being impacted by delays of projects, rising costs and labour shortages. In contrast, the manufacturing sector is performing well, especially construction machinery and industrial machinery."
The automobile production has also got back on a recovery track with the supply shortages of semiconductors solved, he added.
"But we are concerned about overseas demand trends," Hirose admitted. "In China, demand is sluggish, (steel) production continues to be high, and exports are also on the rise. This is having an impact on market trends (and) keeping international market conditions at a low level."
Written by Russ McCulloch, russ.mcculloch@mysteel.com
Edited by Alyssa Ren, rentingting@mysteel.com
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