Japan's crude steel output declines further in February

In February, Japan's crude steel output including both carbon and special steel declined for the second month after 10 consecutive months of rises, down 2.3% on year to about 7.3 million tonnes, according to the latest data released by Japan Iron & Steel Federation (JISF). Despite the on-year decline, Japanese steel mills have been maintaining their output at high levels, according to sources.
Japan's February crude steel output was also down 5.9% on month, but the country's daily steel production averaged 261,000 tonnes during last month, up 5.2% on month, according to a JISF official.

Among the total, blast furnace (BF) mills produced 5.35 million tonnes, down 3.5% on year and 8.2% lower on month, and the balance by electric-arc-furnace (EAF) mills was up 1.2% on year and 1.1% higher on month.

Last month, Japan's carbon steel production accounted for 5.67 million tonnes, down 1.5% on year and 3.9% lower on month, and that of special steel at 1.63 million tonnes, down 4.9% on year and a larger 12.4% on month, the JISF data showed.

"The steeper decline in special steel output was partially due to the slower steel consumption by Japan's auto sector, but the drop would be just temporary," a Tokyo-based steel trader commented.

Over January-February, Japan's crude steel output totaled 15.06 million tonnes, down 2.2% on year, according to JISF data.

By product, Japan's plates output in February increased 19.1% on year in response to the improving steel consumption by domestic shipbuilders and firm demand from other sectors such as machinery manufacturing.

"Japan's plates output will stay at a high level for some time. And when the country's auto sector resumes planned higher production, hot metal supply will tighten and plates output may be adjusted lower," a second trader in Tokyo predicted. He added that Japan's overall hot metal output will remain tight for months with a major BF under relining.

Nippon Steel, Japan's largest integrated mill, has started relining a BF with 4,300 cu m inner volume at Nagoya works in central Japan since the end of January and plans to restart it in June, as reported.