Posted on 13 Apr 2026
Japan's steel industry will experience a slow first quarter of the country's new fiscal year from April 1, with demand seen falling by 1.5% from April-June last year and steel production dipping by 0.7% year-on-year as well, according to a Ministry of Economy, Trade and Industry (METI) forecast released on April 9.
During the quarter, domestic and export steel demand – expressed in terms of crude steel – will dip only slightly but sufficiently to push the reading into the 17 million-tonne range at 17.98 million tonnes, the ministry's data show, a major decline from the near 20 million tonnes that METI had predicted for same quarter demand only two years ago.
Within the demand total, that for ordinary steel will be 14.32 million tonnes, lower by 1% on year, and within that, domestic demand will be 9.22 million tonnes, lower by 1.8% from last fiscal's Q1, according to the METI.
"Looking at the consumption of ordinary steel by sector for domestic use, industrial machinery is the only area in manufacturing where demand is seen increasing year-on-year, with demand for shipbuilding and automobiles rising only sluggishly," the ministry said.
And even these predictions could prove optimistic, with industry daily Tekko Shimbun quoting a METI official as saying that the impact on steel demand of the hostilities in the Middle East had not been factored into the demand forecast. The official only promised that the ministry would "pay close attention" to the troubles in the Gulf.
Nippon Steel executive vice president, Takashi Hirose, was more forthright, drawing attention to the decline in exports of Japanese vehicles to the Middle East, for example, and the knock-on effect this would have on domestic steel sales to Japanese automakers.
According to the finance ministry's trade statistics, Japan's auto exports to the Middle East in 2025 reached some 820,000 units, up 15% on year, with automobiles accounting for half of Japan's total exports to the region.
"There is certainly an impact," Hirose had admitted to Japanese media after a Steel Industry Roundtable briefing also on Thursday. "But we are maintaining production as a whole due to the recovery from exports to other regions," he had insisted, adding that there was no significant impact at the moment.
Over the past week, several Japanese carmakers including Mazda Motor and Subaru have announced production halts of vehicles being manufactured for the Middle East market, with Mazda saying it will stop producing vehicles for export to the region until May.
Meanwhile, based on views the ministry had gathered from steelmakers, the METI predicts that crude steel production this quarter will fall to the 20 million tonnes level or below for the first time since July-September last year, with the dip being the first in two quarters.
Source:Mysteel Global
