Japanese Steelmakers Hurt by Lower Prices in 1st Half

Tokyo, Nov. 11 (Jiji Press)–Major Japanese steelmakers were hurt by lower prices caused by overproduction in China in their fiscal first half ended in September. Nippon Steel Corp. posted a large net loss, while JFE Holdings Inc. saw its net profit drop. Kobe Steel Ltd. logged a net profit increase thanks to the sale of cross-shareholdings, but its operating profit declined. Nippon Steel swung to a consolidated net loss of 113.3 billion yen from a profit of 243.3 billion yen a year before. The company took a hefty charge related to the dissolution of a U.S. joint venture with a major European steelmaker to address anticompetitive concerns over its acquisition of United States Steel Corp. JFE’s consolidated net profit fell by about 40 pct to 26.6 billion yen due to a decline in crude steel production and a drop in profit margins. “A deterioration in the supply-demand balance as a result of China’s massive exports is spreading worldwide,” JFE Chief Financial Officer Masashi Terahata said. Kobe Steel’s operating profit dropped by around 20 pct. The three Japanese steelmakers lowered their full-year estimates for the impact of U.S. President Donald Trump’s tariffs thanks to a drop in levies on Japanese cars and easing concerns over U.S.-China trade tensions. Nippon Steel cut its estimate for the impact of U.S. tariffs from 50 billion yen to 20 billion yen. Kobe Steel now expects the tariffs to cost it 3 billion yen, down from its previous estimate for 5 billion yen. JFE now expects its full-year crude steel output to be roughly 500,000 tons lower than the previous year, better than its previous estimate for a decline of 1 million tons. END [Copyright The Jiji Press, Ltd.]