Japanese domestic steel demand to slow down during H1 2015: NSSMC

BEIJING (Scrap Monster):  Nippon Steel and Sumitomo Metal Corporation (NSSMC) has lowered its earlier forecast of domestic steel demand over the six-month period from January to June this year. According to NSSMC, the declining demand from construction and manufacturing sector are likely to offset the rise in demand for special steel.

The country’s domestic steel demand has been lowered from earlier 32.78 mt to 32.22 mt over January-June 2015. The steel demand during the corresponding six-month period in 2014 had been slightly higher at 33.34 mt. However, the demand is expected to be marginally higher when compared with H2 2014. The Japanese domestic steel demand during July to December last year was 32.06 mt.

The NSSMC report points out that the higher consumption tax which came into effect on April 1^st, 2014 has continued to hit the steel demand. The country had already given clear signs of recession during the third quarter of the previous year. The construction, manufacturing and automobile sector growth has stalled.

The construction steel demand has been revised downward from the earlier 11.77 mt during the first half of the year to 11.42 mt. The automotive demand is also expected to remain lower at 5.56 mt, when compared with the demand of 5.84 during the same period last year. However, NSSMC upgraded the special steel demand to 6.49 mt, marginally higher from the earlier forecast, but still down when matched with the demand of 6.7 mt during January to June 2014.