Japan Carbon Steel Demand Expected to Recover in 3Q

Mr. Katsutoshi Kurikawa, chairman of Non-Integrated Steel Producers’ Association, attended a regular press conference in Tokyo on Monday and gave an overview that the demand is expected to upturn in or after September when the indicator, Japanese new start building floor space increased by 15% in July from a year earlier and the orders are steadily increasing for earthquake resistant works of schools or welfare facilities though civil engineering works maintain stagnant.

As for ferrous scrap price, Mr. Kurikawa said the price trend is weak due to output decrease by Japanese integrated steel makers as well as high yen rate despite of high iron ore price. However, the price is expected to strengthen soon since integrated steel makers would increase output for automobiles in and after September-October. Mr. Kurikawa pointed out electric furnace steel makers should cautiously seek decent selling price level for better profitability.

As for Japanese renewable energy feed law, Mr. Kurikawa said it was not bad movement for the Association when Japanese government included charge relief measure for energy-intensive industries but it is necessary that electric power price should be lowered to the same as international level. Mr. Kurikawa told electric power supply problem still remains tough for domestic electric furnace steel makers.