Japan Strengthens Risk Control against Asian Market

Ministry of Economy, Trade and Industry (METI), Japan will strengthen risk control for Asian steel market which is changing by the inflationary resource such as oil in China, South Korea, Taiwan or Association of Southeast Asian Nations. METI illumines cautious reaction against Asian market to Japan Iron & Steel Institution when Chinese huge overcapacity may bring on market disruption. Moreover, the ministry pointed out market cultivation is more important in developing country or resources country. Steel demand may shift from expansion to shrinkage when global economy is slowed down by high oil price or subprime loan problem in USA. Japanese steel export accounts for 50% of all shipment including indirect export, which is mainly for South Korea, China, Taiwan or Thailand. METI considered they need to reinforce risk control against Asian market. Chinese economic growth rate is expected to decrease to 10% in 2008 from over 11% in last year. Chinese steel industry produces steel products at 500 million tonnes, which may increase the export to Asian market if the steel market runs down. Asian market has possibilities to jumble.