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Steel Demand Prospects for the First Quarter of FY2014 (April-June 2014)

Total steel demand for the first quarter of FY2014 (April–June 2014) is estimated to be 23.62 million tons, a 3.6% decrease from the previous quarter and a 2.4% decrease on a year-on-year basis, although the fundamentals of the Japanese economy are steady. The sector-by-sector breakdown is as follows.

Domestic demand
Construction: Steel demand will decrease from the previous quarter and on a year-on-year basis, due to a reactionary decline after the last-minute demand for construction before the consumption tax hike in addition to a seasonal decline in civil engineering demand.

Manufacturing: Steel demand will decrease from the previous quarter, mainly due to a reactionary decline after the last-minute demand for motor vehicle and other demand before the consumption tax hike in addition to the seasonal factor of the period following the accounting period. Demand will remain flat on a year-on-year basis with steady demand for shipbuilding and demand related to business investment including heavy electric machinery despite decreases in demand for motor vehicles, home appliances, etc.

Steel exports: Exports of ordinary steel will slightly decrease from the previous quarter due to continuous excess supply of steel in Asia. Exports will also decrease on a year-on-year basis.

Crude steel demand for the period will decrease by 1.2% from the previous quarter (forecasted result) to 27.01 million tons. Demand will decrease for the first time in six quarters, by 3.8% on a year-on-year basis.

Steel Demand Prospects for the First Quarter of FY2014 (April–June 2014)

(Unit: million tons)

  Total Steel Ordinary Steel Special Steel
Steel Demand 23.62 18.56 5.06
Year-on-year change (24.19) −2.4% (19.14) −3.0% (5.05) +0.1%
Change compared with the previous quarter’s forecast (24.49) −3.6% (19.36) −4.1% (5.13) −1.4%
1) Domestic Demand 15.39 12.16 3.23
Year-on-year change (15.66) −1.7% (12.37) −1.7% (3.29) −1.9%
Change compared with the previous quarter’s forecast (16.24) −5.3% (12.89) −5.7% (3.35) −3.7%
2) Export 8.23 6.40 1.83
Year-on-year change (8.53) −3.5% (6.77) −5.5% (1.76) +3.9%
Change compared with the previous quarter’s forecast (8.25) +0.3% (6.47) -1.1% (1.78) +2.9%

References:

Crude steel demand equivalent to shipment: 27.01 million tons
Year-on-year change: (28.07 million tons) −3.8%
Change from the previous quarter’s forecast: (27.33 million tons) −1.2%

Ordinary steel: Inventory of makers and wholesalersi
Inventory of makers and wholesalers (end-March forecast): 6.51 million tons; Inventory turnover: 1.02 months
Inventory for domestic market within the above inventory (end-March forecast): 5.61 million tons;
Inventory turnover: 1.33 months

Note 1: The figures in parenthesis show the quantity for the same period of the previous year or the previous quarter's forecast for comparison purposes (in millions of tons).

Note 2: The total steel amount does not always correspond to the combination of subtotals since those figures are calculated per thousand tons.

Reference for Demand Prospects (Fourth Quarter of FY2014 (April - June 2014))

1. Trends in Crude Steel Production (Unit: thousand tons)

  FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014
1Q 31,060 19,093 28,067 26,368 27,498 28,073 27,007
2Q 30,448 24,236 27,357 26,950 27,260 27,724  
3Q 26,397 26,609 27,665 26,579 25,909 28,139  
4Q 17,596 26,511 27,704 26,566 26,637 27,332  
Total 105,500 96,449 110,792 106,462 107,304 111,268 27,007

Note 1) The data for the fourth quarter of FY2013 is the forecasted result and the data for the first quarter of FY2014 represents prospects.

2. Ordinary Steel: Sector-by-Sector Domestic Consumption (Unit: thousand tons)

Sector FY2013 1Q Actual consumption FY2013 4Q Consumption Forecast FY2014 1Q Prospects Year-on- Year Change Change Compared with the Previous Quarter's Forecast
Construction Total 5,464 5,576 5,277 −3.4% −5.4%
  Civil Engineering 1,426 1,704 1,406 −1.4% −17.5%
Architecture 4,038 3,872 3,871 −4.1% −0.0%
Manufacturing Total 6,906 7,314 6,883 -0.3% -5.9%
  Shipbuilding 992 1,076 1,078 8.7% 0.2%
Motors Vehicles 2,780 2,969 2,732 -1.7% -8.0%
Industrial Machinery 1,171 1,191 1,145 -2.2% −3.9%
Electrical Machinery 743 828 742 -0.1% -10.4%
Secondary Products 591 617 574 −2.9% −7.0%
Containers 321 313 307 −4.4% −1.9%
Other 308 320 305 -1.0% -4.7%
Total 12,370 12,890 12,160 -1.7% −5.7%

Note 2) The quantity is estimated mainly based on demand-related statistics.

Release date

April 2, 2014

Division in Charge

Iron and Steel Division, Manufacturing Industries Bureau

Ministry of Economy, Trade and Industry
1-3-1 Kasumigaseki, Chiyoda-ku, Tokyo 100-8901, Japan Tel: +81-(0)3-3501-1511
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