Japan Iron Ore and Coking Coal Import Decrease in F2008

Japanese iron ore import decreased by 8.7% to 128.5 million tonnes in fiscal 2008 (Apr08-Mar09) from the previous fiscal year, according to the trade statistics by Ministry of Finance. The annual import represented the first year-on-year decrease since fiscal 2005. The import dropped by 34.4% year-on-year comparisons for January-March 2009 when Japanese steel makers accelerated output reductions. The annual import of coking coal decreased by 0.5% to 85.5 million tonnes in fiscal 2008 from fiscal 2007, which dropped by 14.6% for January-March.

The averaged unit price of imported iron ore was CIF 10,400 yen per tonne through fiscal 2008, up by 36.2% from fiscal 2007. The averaged unit price of hard coking coal jumped by 2.2 times to CIF 28,000 yen per tonne. The annual contract price doubled for Australian iron ore and tripled for hard coking coal at maximum. However, annually averaged price including freights was lower than the annual contract price in yen.

Total import value of iron ore and coking coal was 3.16 trillion yen through fiscal 2008, up by 1.21 trillion yen from the previous fiscal year. Japanese steel industry’s cost up was initially estimated at more than 2 trillion yen due to upsurge of the annual contract price. However, the apparent cost up was lower than the estimation because of the partial carry over of previous-fiscal-year contract price, the import volume down in the last half of fiscal 2008 and stronger exchange rate of yen against offshore currencies. In fiscal 2009, some materials with high contract prices will be carried over.

Monthly iron ore import decreased by 48.2% year-on-year comparisons in March while coking coal decreased by 27.1%. The averaged unit price was higher by 60.1% year-on-year for iron ore and by 2.9 times for hard coking coal.