By Yuka Obayashi
TOKYO (Reuters) – Japan’s crude steel output is expected to fall 2.4% in the first three months of 2025 due to slow demand from the manufacturing and construction sectors, the Ministry of Economy, Trade and Industry (METI) said on Thursday.
The forecast would bring the world’s third-largest steel producer’s annual output for the fiscal year ending March 31 to 83.72 million metric tons, down 3.6% from a year earlier. It marks the lowest output since fiscal 2020, when the COVID-19 pandemic eroded demand.
“Steel demand will likely remain sluggish due to weak demand from manufacturers including automakers and from the construction sector,” Manabu Nabeshima, director of METI’s metal industries division, told a news conference.
The ministry estimated crude steel output to be 20.93 million metric tons in January-March, down from 21.45 million tons a year earlier. It would log a 0.1% drop from the current quarter.
Demand for steel products, including those for exports, is forecast to fall 0.5% to 19.09 million tons in January-March compared with a year earlier, the ministry said, citing an industry survey.
Exports are forecast to fall 0.4%, the ministry said.
The Japan Iron and Steel Federation projected on Wednesday that the country’s crude steel output in fiscal 2025 will see a slight increase compared to the current year.
However, the federation’s chairman, Tadashi Imai urged the government to take swift trade measures against rising steel imports from China to protect domestic supply chains.
When asked about potential trade actions, Nabeshima said, “We can’t comment on specific actions,” but noted that China’s steel exports have surged significantly, leading to an increase in Japan’s imports.
“We aim to respond promptly while adhering to WTO trade rules,” he added.
Japanese steelmakers have repeatedly voiced concerns over China’s growing steel exports.
Chinese steelmakers, already exporting at near-decade high volumes, are set to keep pushing out shipments in 2025 to manage overcapacity and soft domestic demand, industry insiders and analysts say, threatening to worsen mounting trade frictions.
(Reporting by Yuka Obayashi,; Editing by Alexandra Hudson)
