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Steel Demand Prospects for the Third Quarter of FY2014 (October–December 2014)

Total steel demand for the third quarter of FY2014 (October–December 2014) is estimated to be 24.82 million tons, a 0.6% decrease from the previous quarter and a 0.2% decrease on a year-on-year basis, which will remain flat from the previous quarter. The sector-by-sector breakdown is as follows.

Domestic demand
Construction: Steel demand in civil engineering works will increase from the previous quarter due to seasonal factors, while that in the construction sector will remain flat compared to the previous quarter. The demand in housing construction on a year-on-year basis will decrease due to a reactionary decline after the consumption tax hike, while that in the construction sector as a whole will also decrease.

Manufacturing: Steel demand will remain flat from the previous quarter. The demand in shipbuilding will increase on a year-on-year basis, while that in motor vehicles will decrease due to a reactionary decline after the consumption tax hike. The demand in industrial machinery will increase on a year-on-year basis along with increasing business investment, including machine tools and transportation machineries, while that in construction machineries will decrease on a year-on-year basis due to a reactionary decline after the last-minute demand before the tightening of vehicle exhaust gas regulations. A slight decrease on a year-on-year basis will also be shown in the industrial machinery sector as a whole.

Steel exports
Exports of ordinary steel will show a decrease from the previous quarter. While an excess supply of steel continues to persist in Asia, the exports will increase on a year-on-year basis based on the situations where energy-related exports surpassed those in the same period last year and the domestic demand was given priority over the exports in the same period last year.

Crude steel demand for the period is estimated to be 27.98 million tons, decreasing by 0.1% from the previous quarter as well as by 0.6% on a year-on-year basis, and the demand will remain flat in this quarter.

Steel Demand Prospects for the Third Quarter of FY2014 (October–December 2014)

(Unit: million tons)
  Total Steel
  Ordinary Steel Special Steel
Steel Demand 24.82 19.62 5.20
  Year-on-year change (24.86) −0.2% (19.78) −0.8% (5.08) +2.3%
Change compared with the previous quarter’s forecast (24.96) −0.6% (19.69) −0.4% (5.27) −1.5%
1) Domestic Demand 16.30 12.97 3.33
Year-on-year change (16.76) −2.8% (13.35) −2.8% (3.41) −2.5%
Change compared with the previous quarter’s forecast (16.15) +0.9% (12.84) +1.0% (3.31) +0.6%
2) Export 8.52 6.65 1.87
Year-on-year change (8.10) +5.2% (6.43) +3.4% (1.66) +12.2%
Change compared with the previous quarter’s forecast (8.82) −3.4% (6.85) −2.9% (1.97) −5.1%

References:

Crude steel demand equivalent to shipment: 27.98 million tons
Year-on-year change: (28.14 million tons) −0.6%
Change from the previous quarter’s forecast: (28.00 million tons) −0.1%

Ordinary steel: Inventory of makers and wholesalers
Inventory of makers and wholesalers (end-September forecast): 6.63 million tons; Inventory turnover: 1.04 months
Inventory for domestic market among the above inventory (end-September forecast): 5.77 million tons; Inventory turnover: 1.42 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 (Third Quarter of FY2014 (October – December 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 28,081 27,672
2Q 30,448 24,236 27,357 26,950 27,260 27,737 28,002
3Q 26,397 26,609 27,665 26,579 25,909 28,139 27,976
4Q 17,596 26,510 27,705 26,566 26,638 27,567  
Total 105,500 96,448 110,793 106,462 107,305 111,523 83,650

Note 1) The data for the second quarter of FY2014 is the forecasted result and the data for the third quarter of FY2014 represents prospects.

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

Sector FY2013 3Q actual consumption FY2014 2Q consumption forecast FY2014 3Q prospects  
Year-on- year change Change compared with the previous quarter’s forecast
Construction   6,036 5,658 5,812 −3.7% 2.7%
  Civil Engineering 1,857 1,724 1,842 −0.8% 6.8%
  Architecture 4,179 3,934 3,970 −5.0% 0.9%
Manufacturing   7,314 7,182 7,158 −2.1% −0.3%
  Shipbuilding 1,071 1,086 1,094 2.1% 0.7%
Motor Vehicles 2,883 2,800 2,800 −2.9% 0.0%
  Industrial Machinery 1,297 1,309 1,273 −1.9% −2.8%
  Electrical Machinery 773 777 765 −1.0% −1.5%
  Secondary Products 622 589 603 −3.1% 2.4%
  Containers 344 307 312 −9.3% 1.6%
  Other 324 314 311 −4.0% −1.0%
Total 13,350 12,840 12,970 −2.8% 1.0%

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

Release Date

October 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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