Japan's crude steel output down 5% YoY in May

Of greater concern to the mills – and specifically, their raw materials suppliers – was the fact that daily crude steel production last month averaged only 220,400 tonnes, up by just 0.1% from April's average of 220,100 t/d.

Annualized out over a full year, the May daily average would make for a crude steel total this calendar year of about 80.45 million tonnes – much lower than the calendar 2024 result of 84.01 million tonnes, as Mysteel Global reported. It would also be 7 million tonnes down on calendar 2023 and 9.2 million tonnes lower than in 2022.

The on-month dip in May output could be partly attributed to some electric arc furnace steelmakers halting operations to allow staff to enjoy their Golden Week of public holidays which this year spanned April 29 through till May 6. But the spring holiday break does not explain the falls in January-May output where production via the blast furnace-BOF route totalled 25.01 million tonnes, down 4.2% on-year, and that of EAF producers fell by a larger 7.9% on year to 8.82 million tonnes, the data show.

By product, output of all but 4 of the 20 carbon steel items the JISF tracks declined on-year during May, with the exceptions being sheet piles, heavy bars, ordinary wire rods and cold-rolled coils, the data show. During January-May, production of only 3 items increased – that of ordinary and high carbon wire rods, and CRC. 

Addressing Japanese media following a regular industry round-table conference held earlier this month, Nippon Steel executive vice president Takashi Hirose had little optimism to share.

"The impact of US trade policy has led to an increasing sense of uncertainty overall," he observed. "Trends in domestic demand sectors for steel materials are becoming increasingly negative, particularly the year-on-year decline in housing construction starts. The non-residential construction sector has grown, though this is due to the Osaka Integrated Resort and related demand," he suggested. The Osaka IR is a massive resort complex being built on an island in Osaka Bay combining a casino with three hotels, a sports area and other facilities, due to be completed in 2030, Mysteel Global notes.

"The automotive sector has improved from the low performance last year, but the current level is not necessarily high, while the overall trend in exports is, again, negative, including the volume of shipbuilding export contracts and the industrial machinery production index," Hirose said. New data from the Japan Ship Exporters' Association show that in May, the Japanese shipyards received orders for just 13 vessels totalling 884,100 gross tons, lower by a huge 48% from May last year.

Japan's January-May 2025 production of carbon steel items (selected)

Unit: Tonnes

Source: JISF

Written by Russ McCulloch, russ.mcculloch@mysteel.com

Edited by Alyssa Ren, rentingting@mysteel.com