Firm Japan Structural Steel Demand for Building

Japanese heavy structural steel demand for building decreased by 2.7% to estimated 1.914 million tonnes in April-June from same period of 2005, according to calculation by Japan Metal Bulletin based on building start statistics of Ministry of Land, Infrastructure and Transport. The demand is still firm at 649,750 tonnes in April, 621,750 tonnes in May and 642,550 tonnes in June. The demand could be 7.2-7.3 million tonnes in fiscal 2006, which is flat or slight increase from fiscal 2005, when an integrated steel maker source expects the major building demand will expand for warehouse, plant and commercial facility. Building start of steel and reinforced concrete structure increased by 81% to 1.849 million square meters in April-June from same period of 2005 while the steel structural building start decreased by 4.9% to 18.216 million square meters. The wide jump of steel and reinforced concrete structure building start is estimated to be higher activities for major projects including redevelopment around Tokyo. The structural steel demand for building decreased by 4.4% to estimated 1.608 million tonnes in January-March from same period of 2005 partly due to structural calculation sheet fabrication scandal. The steel procurement is estimated to be 2 months after the building start. The structural steel demand started to increase in June after the building start increased in April. Most of newly started building with steel and reinforced concrete structure has more than 2,000 square meters of floor space. The larger building construction could result in higher steel demand.