TOKYO, Mar. 29 -- Japan's crude steel output is expected to keep growing in the April-June quarter on strong exports of automotive sheet steel, although the recovery lacks strength due to weak U.S. demand, METI said on Monday.
Crude steel output in April-June, the first quarter of Japan's financial year, is seen rising 37.1 percent from the same period last year to 26.17 million tonnes, the Ministry of Economy, Trade and Industry said.
That would be down 1.5 percent from January-March, when manufacturers and construction companies raised output ahead of book closings for the financial year, the ministry said after a survey of manufacturers, exporters and steelmakers.
"A moderate recovery in demand is continuing," METI director Masaki Koito told a news conference.
"But we won't see a robust recovery until after auto production in the U.S. market shows a strong rebound," he said.
The world's second-biggest steelmaker Nippon Steel Corp (5401.T: Quote) and sixth-ranked JFE Holdings Inc (5411.T: Quote) are raising production to meet demand from fast-growing Asian economies.
Japan's crude steel output in February jumped by more than half from a year earlier helped by vigorous exports to Asia and strong demand from domestic carmakers.
While the strong gain was partly helped by a favourable comparison with the same period a year earlier, when output tumbled amid the worst recession in decades, robust exports to the rest of Asia helped Japan's crude steel output exceed 8 million tonnes for the seventh straight month.
But heavy reliance on demand in Asian economies worries some market watchers given a possible slowdown in the Chinese economy later this year.