Japanese steel orders flat in May as domestic demand offsets exports drop
Japanese orders for carbon steel were flat on the year in May, but domestic demand rose, further defying concerns that bookings would plunge following the increase in the nation’s consumption tax rate on April 1.
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Total steel orders amounted to 5.95 million tonnes, according to figures from the Japan Iron & Steel Federation.
The figure came on the back of a rise in domestic orders, which increased by 3.9% from year-earlier levels, off-setting a continuing decline in export orders.
Steel orders from the domestic manufacturing sector rose by 2.1% to 1.64 million tonnes.
The year-on-year increase reflects the recovery in the Japanese economy over the past twelve months, largely due to a weaker yen and the economic stimulus policies of the Shinzo Abe government.
Orders from the auto industry, the largest consumer of steel, totalled 756,000 tonnes, dropping just 0.1% on the year.
Demand from the shipbuilding sector continues to show further signs of being on a path to recovery, although figures from this segment are highly volatile and subject to big monthly swings.
Orders reached 324,000 tonnes in April, a rise of 10.1% from year-earlier levels.
The figures mean that orders from the sector have posted a year-on-year increase every month so far this year.
Orders from industrial machinery and equipment manufacturers decreased by 1.1% year-on-year to 137,000 tonnes. Those from electrical machinery and equipment manufacturers were up 14.7%, at 135,000 tonnes.
Orders from the construction sector also increased. They rose by 10.5% on the year to 1.03 million tonnes as orders from the building segment rose 8.2% to 577,000 tonnes and those from the civil engineering segment rose 12.9% to 214,000 tonnes.
Orders from dealers, an estimated 70% of which are supposedly consumed in the construction industry, edged up by 0.7% from year-earlier levels to 1.09 million tonnes.
Exports, meanwhile, continued to decline, with volumes 5.8% lower than in the corresponding period a year earlier, at 2.11 million tonnes.
In terms of major products, orders for hot rolled strip dropped by 0.6% year-on-year to 1.74 million tonnes, while those for galvanized sheet rose by 2.1% to 921,000 tonnes.
Heavy plate orders fell by 1.7% from a year earlier to 831,000 tonnes, while orders for bars rose by 4.7% to 685,000 tonnes.