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Domestic orders for steel products received in 2005 inched up 0.7% from the previous year, to
67.91 million tons. Of this total, orders for ordinary steel products amounted to 54.74 million tons,
down 0.9%.
By application, in the construction sector, although public investment was sluggish, orders for
ordinary steel products for use in civil engineering projects dropped only slightly, by 0.5%, thanks
to projects funded by the supplementary budget. The number of new housing starts increased, and
in reflection of strong capital investment, nonresidential construction starts also increased. Despite
these positive factors, orders for steel products for use in building construction overall fell 1.0%. In
addition, orders declined from building materials makers and so on. As a result, orders from the
construction sector as a whole decreased 1.9%, to 13.13 million tons.
In the manufacturing sector, steel orders from the shipbuilding industry, where keel laying was
maintained at a high level, soared 13.4%, to 4.86 million tons. Also, orders from the motor vehicle
industry rose 3.5%, to 11.14 million tons. One factor behind this gain was replacement demand for
standard trucks in connection with emission regulations. Another factor was higher unit production
of four-wheel vehicles due to brisk exports. Meanwhile, orders received from industrial machinery
makers increased 7.8%, to 2.07 million tons, due to recovering exports of mining machinery for the
development of resources around the world and to improving domestic orders related to capital
investment. As a result, orders for ordinary steel products from the manufacturing sector as a
whole remained firm, rising 2.7%, to 25.10 million tons.
In 2005, domestic orders received for special steel products amounted to 13.17 million tons, a
7.6% increase, marking a record high for the third straight year. This gain was brought about by
strong orders from motor vehicle manufacturers and industrial machinery makers, which together
account for more than half of the total demand.
In 2005, shipments of ordinary steel products to domestic users dropped slightly, in part because of
the previous year's surge led by manufacturers. This was the first decline in three years. Domestic
demand was still at a high level, though. With exports to China and other destinations diminishing,
export shipments of ordinary steel products fell below the previous year's level again.
Domestic shipments were down 0.3%, to 59.39 million tons, while export shipments dipped 12.0%,
to 19.89 million tons. The combined shipments of ordinary steel products came to 79.28 million
tons, down 3.5% from the previous year. With supply and demand tightening, furthermore,
domestic inventories at the steelmaker and dealer levels tended to decline at the beginning of the
year. However, they rapidly increased in and after summer, but trended downward once again
toward the yearend. Domestic inventories at the end of December 2005 came to 5.55 million tons,
compared with 5.36 million tons a year earlier. The domestic inventory-shipment ratio rose 6.2
percentage points, to 117.3%.
As for supply and demand conditions for special steel products in 2005, domestic demand from
motor vehicle makers, a major demand industry, jumped 14.2% over the previous year. This
double-digit growth was due primarily to increasing finished car and KD set exports. Demand for
special steel products also rose from industrial machinery makers in reflection of vigorous capital
investment, brisk demand for mining machinery, and other strong trends at home and abroad.
Consequently, domestic shipments of special steel products in 2005 increased 4.6%, to 13.82
million tons. On the other hand, export shipments dipped 7.6%, to 5.37 million tons, due in part to
decreasing shipments to other Asian markets.
With the supply and demand situation tightening, inventories dropped from 1.34 million tons at the
end of the previous year to 1.21 million tons on March 31, 2005. However, they gradually
accumulated thereafter and reached 1.46 million tons at the end of 2005, a 0.12 million ton
increase from a year earlier.
As a result, production of finished special steel products increased 2.0%, to 19.57 million tons, for
the sixth consecutive year of growth, breaking the all-time record for the third year running.
The Domestic Market data (PDF)
