Reuters reported that Japanese demand for crude steel in July to September will be just 1.5% higher than the previous three months despite a robust recovery in the manufacturing sector as inventory levels remain high.
A government survey of domestic steel users, such as carmakers and electric appliance makers, in combination with high inventory levels point to total demand for crude steel of 26.92 million tonnes for the period, the second quarter of the 2011-12 financial year. That would be down 1.6% from the same period a year ago.
Mr Masaki Koito director of the ministry''s Iron and Steel Division said that "Japanese carmakers are planning big production increases during the period as their damaged supply chains have come back online, but the level of inventories is very high.”
Mr Koito said that but domestic inventories of steel products are estimated to stay at around 5.56 million tonnes at the end of June, slightly below the end May level of 5.63 million tonnes.
The government expects demand for steel products to grow 7.1% in July to September compared to three months earlier, pulled higher by a 27% jump in demand from the car sector.
( Source: www.steelguru.com )