Japan’s crude steel output is forecast to fall 2.4% in the October-December quarter from a year earlier, marking the eighth consecutive quarterly drop, amid weak exports and sluggish domestic demand, the government said on Thursday.

Output by Japan, the world’s third-largest steel producer, is expected to total 20.23 million metric tons, representing a 1.2% increase from the previous quarter, the Ministry of Economy, Trade and Industry said.

Total demand for steel products, including exports, is projected to fall 3.5% year-on-year to 18.47 million tons, the ministry said, citing an industry survey.

Exports are forecast to fall 6.1% year-on-year to 6.2 million tons, the ministry said.

“The construction sector continues to suffer labour shortages and rising material costs, while the automotive sector still lacks strong momentum in demand recovery,” Manabu Nabeshima, director of METI’s metal industries division, told a press conference.

“Exports are likely to decrease as Japanese automakers lose market share in China, where sales of local electric vehicles are growing, while economic slowdowns in Southeast Asia and Europe are also weighing on demand,” he said.

Nabeshima said the gloomy forecast did not reflect the impact from U.S. tariffs on steel but took into account the effects of anti-dumping actions imposed by many countries against Chinese steel, which have also affected Japanese products.

China’s steel exports are set to hit an all-time high this year, defying predictions that unprecedented trade barriers would drive down shipments, and threaten to provoke an even fiercer protectionist backlash against the world’s dominant producer.
Source: Reuters