Japan Q4 Steel Demand Down 3.6%, Carbon Steel Exports Taking 7.2% Hit

With risk factors like production uncertainty in China most likely starting to affect not just global markets, but also Asian ones, Japan is set to see a 0.2 percent fall in demand for crude steel in the fourth quarter of 2012, compared to the same period a year before.

The slight dip in crude steel demand means that there will be a 3.6 percent reduction in demand for the metal in Q4, compared to Q3 of 2012.

But it is not just international markets and world scenario that are affecting Japan as their own internal issues that pertain to the use of both crude and carbon steel are playing an important role in causing this dip.

Global economic slowdown and the current trend of carbon steel prices have been a significant factor in reduction of the metal’s exports as it is projected to come down from a figure of 6.9 million tons in this year’s July-September period to 6.4 million tons in the fourth quarter.

While that is a reduction by 7.2 percent it is still an increase by 9.4 percent when compared to the same period last year, during which flooding in Thailand severely affected the Carbon Steel supply chain.

One of the major factors for the reduction in demand for crude steel in the local markets is the decline in car production after Japanese government took away subsidies from the industry. Japan, which is the second largest producer of crude steel on the planet, is projected to consumer 26.54 million tons of the metal in Q4 of 2012.

As the demand from car industry falls by about 8.9 percent compared to the year before, some expect that the reconstruction orders in response to last year’s earthquake will push the demand the back up in the months to come, even as domestic consumption of Carbon Steel sees pretty stable figures.

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