Japanese steel makers are facing whammy

Japanese steel mills are facing a decreased situation because of the low oil market price,weak domestic demand and the worldwide slower economy.Actually the steel producers all over the world have been effected by the fall-off of steel prices,and the huge exporting of China steel material.

Hot coil prices in Asia have tumbled $40-$50 per tonne since July while raw materials prices have slid a mere $2-$3 per tonne,the steel pipes and steel pipe fittings are also in same condition.”Margins dropped to the lowest level in my memory,” 62-year-old Ota said,”We think a full recovery in fundamentals will take time”,adding that there will be no quick improvement.JFE’s Executive Vice President Shinichi Okada echoed this view,saying the bad patch would continue through March.

Week demand for the houses and cars,delayed construction projects make the stocks of steel products in a high level.Actually,the China steel pipes and pipe fittings are not into the Japan market directly.But they worry about other area supplier like Taiwan and South Korea.The pipe fittings of Taiwan are selling a lot in Japan now.

In a sign that might already be happening,Japan’s steel imports in August increased 4 percent from the same month last year,the first rise in 10 months,with supply from South Korea jumping 14 percent.