Sumitomo Metals to Reduce Raw Steel Output by 500,000 tonnes in 2H

Sumitomo Metal Industries reduces the raw steel output by around 500,000 tonnes in second half year of fiscal 2008 ending March 2009 compared with original plan under slower demand for automobile. The production decreases by 3.5% to 13.5 million tonnes for fiscal 2008. Japanese major steel makers expand the output reduction when Nippon Steel, JFE Steel and Kobe Steel already announced additional output reduction.

Sumitomo Metals’ raw steel output will decrease by around 600,000 tonnes to 6.46 million tonnes in the second half from the first half. The firm announced in October the output will decrease by around 100,000 tonnes for second half from the first half. The firm planned 14 million tonnes of production for fiscal 2008 originally compared with 13.62 million tonnes in fiscal 2007.

The firm keeps the seamless pipe production and increases the plate production while the firm reduces the output for construction and automobile applications. The firm expects Japanese automobile production will decrease to 10.8 million units in fiscal 2008 from 11.8 million units in fiscal 2007.

Nippon Steel expanded the output reduction in the second half from 1 million tonnes to more than 2 million tonnes. JFE Steel increased the production cut from 500,000 tonnes to 1.5 million tonnes and Kobe Steel expanded the output reduction from 200,000 tonnes to more than 600,000 tonnes. Nisshin Steel revises the plan to reduce the output by around 140,000 tonnes.