Japan Cemented Carbide Demand Slows Down in F2006

Japanese cemented carbide tool shipment hit record 333.8 billion yen in fiscal 2006 ended March 2007, up by 10.2% from fiscal 2005, while the cemented carbide production was 6,173 tonnes in fiscal 2006, down by 3.7% from fiscal 2005, according to survey for 43 members of Japan Cemented Carbide Tool Manufacturers’ Association (JCTMA). The tool shipment value hit record for 4 years in a row while the alloy production volume represented year-to-year decrease for the first time in 5 years.The actual growth rate of tool shipment value seemed to become less than 10% in fiscal 2006 when the shipment value was pushed up by the number increase of JCTMA’s members and price hike by tool makers. Domestic demand of cemented carbide tools has declined since July 2006 when domestic automobile industry postponed their new investment.The year-to-year growth rate of tool shipment value kept less than 10% for 3 quarters in a row since July-September 2006, while the alloy production volume represented year-to-year decrease for 4 quarters in a row since April-June 2006. Domestic cemented carbide demand clearly slowed down in fiscal 2006, although annual alloy production volume kept over 6,000 tonnes for 2 years, which hit record 6,408 tonnes in fiscal 2005.Japanese cemented carbide tool export represented year-to-year increase for 5 straight years since fiscal 2002, which hit record in fiscal 2006 and exceeded 70 billion yen for 2 years in a row. Japanese cemented carbide tool import exceeded 50 billion yen for the first time in fiscal 2006, which represented year-to-year increase for 7 straight years. In recent years the export especially kept favorable thanks to active output expansion by Japanese automakers at overseas. However, in fiscal 2006, the growth rate became slower than previous 3-4 years for both cemented carbide tool export and import.