Japan steel body sees FY'22-23 crude steel output at 95-97 mn t

Japan's domestic crude steel output for FY'22-23 is expected at 95-97 million tonnes (mn t), according to Eiji Hashimoto, Chairman, Japan Iron and Steel Federation (JISF).

Crude steel production is expected to recover in FY'22-23 owing to the economic recovery from the earlier weakness triggered by the Covid-19 pandemic.

This level of recovery will continue in CY'22. However, the production capacity of steel makers is currently below 100 million tonnes (mn t) per year, and so it is expected to fall short of the pre-pandemic level.

Hashimoto said, "We expect 95-97 mn t (of crude steel production) in CY'22. Demand will continue to recover, but based on the current production capacity of 100 mn t, it will not exceed."

Japan's domestic steel demand in CY'22 is expected to remain firm, mainly from the downstream manufacturing industry, in addition to the recovery in automobile production, although the latter is currently on a downward trend due to the disruption of the supply chain caused by the shortage in semi-conductors. Meanwhile, the industrial machinery sector is expected to remain firm against the backdrop of demand for capital investment. Demand from the construction and civil engineering sector is also expected to move up steadily, while domestic demand will continue to recover, according to the Federation.

Export demand is likely to remain at the same level in the next financial year as seen in FY'21. With the resumption of global economic activity, overseas demand for steel recovered significantly in FY'21 and is expected to continue into FY'22.

Hashimoto also said he hoped the United States would abolish the "Section 232 tariffs" imposed on Japanese steel imports as soon as possible.

While the recovery trend continues, the Japan Iron and Steel Federation dwelt on the current status of infections from the mutant strains of the new coronavirus variant, global supply chain disruptions, soaring raw material costs, trade friction between the United States and China, and trends in the Chinese economy.

"If we cannot control the infection, the supply chain disruptions may be prolonged," Hashimoto said at a press conference.

Domestic crude steel production is set to recover to about 97 mn t for two consecutive years in FY'21 and FY'22, but due to supply hiccups, it will not return to the pre-Covid levels.