Posted on 22 Dec 2023
The Japan Iron & Steel Federation (JISF) noted in its latest forecast released on Wednesday 20 December that Japan's crude steel production, as well as internal and external demand in 2024 are expected to be the same as in 2023.
The association said high material costs and labour shortages in the construction industry will lead to a slight decline in demand for construction steel in 2024. At the same time, strong housing prices have hindered demand for property purchases and thus led to a decline in new housing starts, which has also had a negative impact on steel demand.
Labour shortages will also hit manufacturing activity next year. The shipbuilding industry's backlog of orders will be the same as this year, JISF said, however, demand for steel in the machinery sector will decline because machine tool demand has already peaked in 2023. Japan's automotive industry is likely to see an increase in demand for steel, with JISF expecting the backlog of orders to be gradually completed.
The global economic slowdown will continue next year, which is also dragging down Japan's domestic demand recovery and capital investment demand, as well as exports, Kallanish learns from JISF.
In 2023, while demand for steel in the automotive sector has recovered as semiconductor supply shortages ease, overall demand remains lower than in 2022. Soaring steel prices and labour shortages have also hampered recovery in demand in the construction and shipbuilding industries. Reduced overseas demand has meanwhile cut the need for machinery production.
JISF expects domestic and external steel demand to increase in 2023 compared with 2022, but crude steel production will see a year-on-year decline, according to its public report. Between January and November this year, Japanese crude steel output lost 2.8% y-o-y to 80.016mt (see separate article).
Source:Kallanish
