Our interview started with a discussion of the main factors influencing Japan’s stainless steel market.
“Although many people may think that Japan’s economic performance is the factor exerting the single largest influence on the country’s stainless steel industry, I believe that the exchange rate is having the most effect,” begins Mr Imai. “The tendency towards a weak yen empowered export businesses as they were strong enough to compete with other countries. This led to stainless steel manufacturers re-focusing on domestic production instead of overseas production. However since the last change in the government in December 2014, there has been a growing trend towards buying yen because of instability in world affairs. As a consequence it has been difficult to predict the strength of the currency. This factor, in addition to the low oil price, has seriously affected prices for domestic equipment connected to the petrochemical industry.”
“According to the export industry, a proposed seawater desalination plant has been postponed and demand for oil-well drilling has completely stopped, both of which have negatively affected the special metals sector. Furthermore, low-cost imported materials from Asian mills have increased and this is impacting on the rehabilitation of the domestic market in Japan.”
“Today one of the sectors with the fastest growing consumption of stainless steels in Japan is kitchen equipment for commercial facilities and the food service industry,” continues Mr Imai. “Demand is strong and is expected to remain so for some time. Long-term projects resulting from the enormous impact of the great earthquake and tsunami in eastern Japan in 2011 are another important consumer.”
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