Japan Special Steel Makers Increases Production Rapidly for Automobile

Japanese special steel makers are increasing operation rate to respond recovery of automobile output for last half of fiscal 2011 ending March 2012 when domestic completed automobile output is expected to increase by over 30% to 5.5 million sets for the last half of fiscal 2011 from the same period of last year. Daido Steel sets steel shipment volume target to increase by 10% to 662,000 tonnes for the last half of fiscal 2011 from the first half. Aichi Steel plans to increase crude steel output by 10-15% to 120,000 tonnes per month for the last half of fiscal 2011 from the first half. Hitachi Metals and Sanyo Special Steel are also increasing the operation rate for automobile.

There is high possibility that the supply and demand becomes tight for specific users. It becomes major focus that each special steel maker can or not extend operation time when they are forced in reduce operation ratio by brownout according to the time of day.

Sanyo Special Steel was in sight full operation at 100,000 tonnes per month in medium-term management plan, and approaches upgrading of production system for enhancement of supply power for mainly bearing steel. Hitachi Metals is building up Moka works which produces casting for automobile, Kumagaya works which produces wheel parts and Kyusyu works which produces heat-resistant steel.

Electric furnace special steel makers’ crude steel output decreased by 9.45 to 1.77 million tonnes for April-June from the corresponding of last year due to aftermath of the earthquake disaster. The peak of the output was 2.03 million tonnes for October-December 2010. The output is expected to be over the peak level due to rebound of automobile output after the last half of fiscal 2011.

The amount of completed automobile output decreased by 33% to 1.54 million sets for April-June from the corresponding of last year, while is expected to increase to about2.4 million sets for July-September and to 5.5-5.7 million sets for October 2011-March 2012.

One special steel maker source apprehends there is possible special steel makers can’t respond delivery despite of full operation by them.