UBS Securities Japan’s analyst Katsuya Takeuchi estimates Japanese rebuilding activity creates 3.5 million tonnes of construction steel demand for damaged areas by the major earthquake in and after fiscal 2012 starting in April 2012. He revised the estimated when the government is finalizing the special budget for the rebuilding while he expected 4 million tonnes of demand before.Mr. Takeuchi revised the estimation downward when Japan government’s expenditure is smaller for construction than expected. However, he expects the rebuilding demand is still large for annual 20 million tonnes of domestic construction steel market. The government expends around 7 trillion yen for construction in rebuilding special budget. Mr. Takeuchi expects the budget represents 3.5 million tonnes of steel demand when 1 trillion yen of nominal construction investment has consumed around 500,000 tonnes of steel. Mr. Takeuchi estimates Japanese construction steel demand increases by 6.8% to 9 million tonnes for concrete reinforcing steel bar and by 4.9% to 5.74 million tonnes for steel section including H-beam for fiscal 2012 from fiscal 2011.
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