Japan's steel production is projected to increase in 2019

The head of the Japan Steel Federation said production in 2019 is likely to increase amid strong local demand from the construction segment ahead of the 2020 Tokyo Olympics and in the absence of severe disaster impacts, the head of the Japan Iron and Steel Federation said.

The country's steel production fell 0.3 percent to a nine-year low in 2018 as a string of natural disasters and disruptions in steel mills slowed production. The fall in production displaced Japan to the third largest producer in the world after China and India.

“Steelmakers were not able to produce as much as planned due to a series of natural disasters and systemic problems in the past year,” said Kouji Kakigi, chairman of the Japan Iron and Steel Federation.

“However, production is expected to increase this year as I do not expect natural disasters to recur to the same extent,” he said.

The country's steel exports also fell 4.2 percent in 2018 to 36.53 million tons, falling for the fifth straight year, while shipments to the United States fell 19.6 percent.


Last March, the United States imposed 25 percent tariffs on imported steel to protect American manufacturers, risking revenge on major trading partners such as China, Europe and neighboring Canada.

“The main reason for the drop is a lack of production capacity on the part of Japanese steelmakers,” Kakigi said, citing persistent problems at his factories.

He predicted that Japanese steel exports would remain unchanged this year.

Asked about the impact of the disastrous Vale dam accident in Brazil on iron ore purchases by metallurgists, Kakigi said: “Iron ore prices are rising. We need to keep a close eye on how local authorities and Vale are handling this and how the Chinese market moves after the Lunar New Year. ”

Benchmark iron ore futures in China rose on Thursday, reaching their highest level in 17 months, fueled by concerns about supply disruptions following the Brazilian disaster.