The Ministry of Economy, Trade and Industry of Japan released on September 28th 2012, in a lecture held at the Special Steel Club, a forecast of demand for special steel products in Japan during the Q4 (October to December) of 2012, of which details are as per the attached table hereto.

Forecasted demand on a monthly basis during the Q4 (October to December) of 2012 of special steel products in Japan is, for domestic sales 1,060,700 tonnes, for exports: 558,400 tonnes, totaling to 1,619,100 tonnes, i.e. down 2.8% in domestic sales, down 4.5% in exports and down 3.4% in total, all compared to the estimated figures for the Q3 (July to September) of 2012. Compared to the year ago quarter, October to December 2011, the forecasted demand for the Q4 of 2012 is to decline by 9.4% YoY.

This decline in demand compared to the preceding quarter is mainly due to the European economy turmoil and to the Chinese economy slowdown typically resulting in the slowed demand from construction machinery industry and from exports of tool steel and of energy plant construction material, and also due to decline in demand from the automobile industry in Japan.

Demand of stainless is forecasted to show no sign of quick recovery in a growing pressure from imported materials. Demand of stainless steel for exports are not promising either, i.e. in addition to the strong yen currency, the large-scale plant construction project in Taiwan completed while the severe competition is going on in the Middle East.

Inventory level of all the special steel products as of end July 2012 was 1,600,000 tonnes, meaning that the inventory monthly consumption ratio as of end July 2012 was 0.92 months, a little down from end June 2012. The inventory ratio of tool steel, mechanical structural carbon steel, spring steel, bearing steel and stainless steel was all over 1.0 month as of the end July 2012.

Imports of special steel products has been hovering high since the Q2 (April to June) of 2012.

Source - TEX Report Limited

(www.steelguru.com)