Japan Rebar Demand to Drop 10-20% in F2009

Japanese concrete reinforcing steel bar demand will decrease by 10-20% to 7.24-7.92 million tonne in fiscal 2009 started April from fiscal 2008, according to Non-Integrated Steel Producers’ Association. The demand decreases to less than 8 million tonnes for the first time in 33 years due to slow condominium construction.

The association’s chairman Mitsuoki Hino, who is president of JFE Bars and Shapes, said at the press conference on Monday the makers should be cautious on the supply balance when the building demand could keep slow despite of the government’s stimulus package.

The rebar demand decreased to 8.71 million tonnes in fiscal 2008 from 10.48 million tonnes in fiscal 2007. The demand is expected to decreases by 9.1-16.9% in fiscal 2009 from fiscal 2008 due to historical low building demand despite of the higher demand in civil works. The association expects the demand decreases by 12.8-22.4% to 5.06-5.7 million tonnes for building while the demand increases by 5% to 1.83 million tonnes for civil works.

The association also expects the demand gap between urban areas and rural areas will be wider in fiscal 2009. The building activity is much lower in rural areas than very slow activity in urban areas including Tokyo and Osaka areas.