Japan’s crude steel output fell a smaller-than-expected 2.7% in March from a year earlier as strong overseas demand offset the impact of the devastating earthquake and tsunami, the steel industry association has said.
Crude steel output came to 9.09mt (million tonnes) in March, the Japan Iron and Steel Federation said. The data, which is not seasonally adjusted, marked an increase of 1.7% from February.
Eiji Hayashida, chairman of the federation, had said that the impact from the quake on output in March might be less than people expected, but suggested the data would likely show a drop from the previous month.
An official at the federation said the surprisingly small year-on-year fall in March was due to strong overseas demand, which was met by those steel mills not damaged by the March 11 disaster.
“The impact will really show from here on out,” the official said.
That echoes comments from Hayashida, who warned on Tuesday of rising inventories due to weak demand from domestic manufacturers hurt by the quake.
The earthquake prompted JFE Holdings, Nippon Steel Corp and Sumitomo Metal Industries Ltd to temporarily halt their seven blast furnaces in east Japan, but damage to production facilities was relatively small except for Sumitomo Metal’s Kashima plant, which is located closest to the earthquake’s epicentre.
Hayashida had said demand from domestic manufacturers has been slumping since the quake, and he expects domestic demand for crude steel to decline this financial year despite a pick-up in reconstruction demand after the summer.