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Daido Steel, for example, saw its operating profit rise by 10% to ¥10.56 billion ($107.26 million) in the six months to September 30, and made a forecast of a 36.1% increase to ¥21 billion ($213 million) for the full financial year.

By contrast, Japan's largest steel producer, Nippon Steel and Sumitomo Metal Corp (NSSMC) is projecting its profits to shoot up by 340% over the same period.

Only one electric arc furnace (EAF) operator is projecting those kinds of returns. Sanyo Special Steel says that it expects its operating profit to rise by 381% to 7.3 billion ($74.1 million) and its net profit to rise by 744% to ¥4.3 billion ($43.67 million) during the year.

Although mini-mills say that they are benefiting from rising prices and higher demand for construction steel in particular, they also note that many infrastructure and civil engineering projects are being delayed due to a lack of skilled workers.

Moreover, while blast furnace operators have been enjoying lower coking coal and iron ore prices, EAF operators have had to put up with sharp increases in electricity costs due to the country's nuclear power plants being shut down.

Electric utilities in the north and west of the country raised their charges for industrial users by 8-9% in September, while Kansai Electric, which supplies power to the Osaka region, pushed up its prices by almost 10% in May.

In addition, they note, there has been a sharper-than-expected spike in their scrap costs since July.

"Although we had some success in raising our prices, scrap prices since July have risen above our assumptions. As a result, our results were lower than we had expected,” according to Kyoei Steel, Japan's largest rebar producer. The company’s operating profit decline by 81.6% to ¥417 million ($4.23 million).

In the first-half of 2013, scrap prices shot up by more than ¥3,000 ($29) per tonne, or 10.2%. By contrast, coking coal prices dropped by over 11% over the same period, supporting operating margins at blast furnace operators.

Moreover, while fourth-quarter coking coal prices have risen by $7 from the previous quarter, prices are still $20 lower than they were at the beginning of the fiscal year. Scrap prices, on the other hand, are now higher than they were at the start of the year.

While mini-mills say that demand is likely to pick up further in the fiscal second-half ending March 31, 2014, so will their input costs.

Already, scrap costs are up by more than 3% since the end of the first half, with few signs of weakening. Additionally, electric utilities are expected to push for further rate increases as they cope with spiralling energy import costs.

"Although demand will continue to be firm, labour shortages at construction sites, oversupply in China, the rise in raw material, fuel and other prices, as well as the significant increase in electricity prices nationwide means that a severe business environment continues,” Aichi Steel said.

As a result, based on companies' earnings releases, Steel First estimates that the combined operating profit margins for the full year among the top seven EAF operators will decline to 3.4% from 3.5% in the first half. Net profit margins will be reduced to just 2.2% compared with 2.3% in the first half.

While NSSMC, JFE Holdings and Kobe Steel will also see their margins reduced for the full year, their economy of scale and lower operating costs is clearly mirrored in their significantly higher margins. In the first half, the three had a combined operating profit margin of 4.7% and a net profit margin of 3.8%.

For the full fiscal year, three will have enjoyed a net profit margin of 3.2%, while JFE and Kobe have an average operating margin of 4.5%. NSSMC has not released a forecast for full-year operating profits.