Posted on 16 Oct 2023
Japan’s Ministry of Economy, Trade and Industry (METI) forecasts that both production and demand of Japanese steel will post an on-quarter increase in the December quarter this year, but demand will be a little lower on a year-on-year basis, Kallanish notes.
METI predicts the country’s crude steel output to reach 22.33 million tonnes in Q4, rising 1.7% over Q3 and 4.3% from the year-ago level. Production in Q3 saw year-on-year growth for the seventh consecutive quarter, and Q4 would be the eighth if it materialises.
Quarterly finished steel demand, meanwhile, is expected to be 20.50mt, an on-quarter increase of 1.3% but a year-on-year loss of 0.6%. Like the prior quarter, domestic and overseas demand continued to show opposite trends.
Domestic demand is forecast to rise 2.9% quarter-on-quarter but fall 1.6% y-o-y to 13.83mt. This compares to export demand at 6.67mt, down 2.1% q-o-q but up 1.6% y-o-y.
By type, ordinary and special steel demand are both predicted to climb higher on a q-o-q basis, but would post an increase of 0.2% and a decrease of 3.9% on-year respectively. This will leave the two figures at 16.54mt and 3.96mt in Q4.
For the 10.97mt of domestic ordinary steel demand forecast, METI expects all major sectors to generate more demand than Q3. On a y-o-y basis however, the construction sector will continue to be weaker, while auto, shipbuilding and container industries in the manufacturing sector will perform better.
By the end of September, Japan’s total ordinary steel inventories were 6.23mt, of which 5.19mt was for domestic sales. The two figures are equivalent to consumption for 1.22 and 1.61 months respectively, and have seen a drop of 0.05 and 0.15 months compared with a quarter ago.
Source:Kallanish
