Japan Steel Demand to Drop by 0.9% in April-June, METI

Japanese demand of rolled steel products will decrease by 220,000 tonnes or 0.9% to 25.65 million tonnes for April-June from same period of 2005, announced by Ministry of Economy, Trade and Industry on Thursday. The demand is 400,000 tonnes or 1.5% lower than in January-March 2006. The shipment represents 27.75 million tonnes of raw steel output in April-June 2006, which is 290,000 tonnes or 1% lower than January-March and 1.22 million tonnes or 4.2% lower than same period of 2005. The raw steel output will decrease slightly in April-June from January-March. The steel using manufacturers reduce the output after the output increase toward the year end to March and the higher sheet steel inventory reduces the output by 250,000 tonnes though makers increase the output to build inventory preparing for blast furnace relining and planed maintenance in summer and the steel export increases. METI estimates the yield rate is relative low at 93.9% for the outlook. The ministry also takes into account the pending inventory adjustment while METI considers the makers increase the export at limited volume to keep the selling price despite of increasing Asian steel market price. The ministry expects the inventory of hot rolled, cold rolled and coated steel sheet decreases to 4 million tonnes at the end of June and the adjustment will complete.