Japan November crude steel output rises 10.7% as demand picks up

Japan’s crude steel output rose 10.7% in November from a year earlier, increasing for a ninth consecutive month as local demand continued to pick up from a pandemic-induced slump, the Japan Iron and Steel Federation said on Wednesday.

Output, which is not seasonally-adjusted, climbed to 8.04 million tonnes in the world’s no. 3 steel producer from a year earlier, but declined 2.2% from October.

The healthy recovery came in line with the prediction by the Ministry of Economy, Trade and Industry (METI) in October that the country’s crude steel output was expected to rise about 10% in the October-December quarter from a year earlier.

“The latest data shows a recovery from last year when steel demand and production tumbled due to the pandemic,” a researcher at the federation said.

Annual crude steel output this year will likely bounce back from last year’s 83 million tonnes, the lowest volume since 1969, but will not reach the pre-pandemic 2019 level of 99 million tonnes due to reduced output capacity, he added.

Japan’s biggest steelmaker, Nippon Steel Corp 5401.T, said in February last year that it will shut nearly 10% of its production capacity, an unprecedented move in the once-dominant Japanese steel industry hit by falling demand at home and competition from China.

Helped by solid demand this year, however, Japanese steelmakers are on track for a V-shaped profit recovery, with robust global demand boosting prices of steel products and higher prices of iron ore and coking coal causing hefty appraisal gains on their inventories.
Source: Reuters (Reporting by Yuka Obayashi; Editing by Devika Syamnath)