The relentless summer sizzle has pushed electric power consumption to record highs and boosted consumer demand for summer-season staples — especially beer.
But it is uncertain if the stimulative effects from the heat wave will prove strong enough to hoist the overall economy onto a recovery path as spending on nonseasonal goods faces cutbacks, industry officials said.
The mercury rose to a record high on July 24 across much of the nation, with electricity demand also posting a record. Tokyo Electric Power Co. even had to borrow a total of 800,000 kw in excess electricity from other power firms to meet surging demand.
Tepco said the utility’s monthly pretax profits would rise by some 10 billion yen for every degree increase in temperature.
Brewers are also seeing soaring demand for beer and “happoshu,” a low-malt beerlike brew, with efforts to boost production now in full swing.
Sapporo Breweries Ltd. said beer sales in the Kanto region centering on Tokyo rose 16 percent in July from a year earlier, with those of lower-priced happoshu surging 60 percent.
Asahi Breweries Ltd. also enjoyed record sales in July. “Our earnings for the fiscal first half to June were better than expected, and earnings for the second half also made a good start,” according to an Asahi Breweries spokesman.
Seibu Department Stores Ltd. said it launched a special sale in mid-July of summer clothes with a fall flavor, which helped boost overall clothing sales.
The market for home appliances, however, gave a mixed picture. While sales of air conditioners rose 10.5 percent in June from a year earlier, those of personal computers, other IT products and audio equipment were weak, according to the Nippon Electric Big Stores Association.
Mizuho Securities Co. said in a report that if temperatures in the summer period average a level 1 degree higher than in the 1990s, consumer spending in the July-September quarter would be pushed up by some 1.3 percentage points.
But the positive effects from the heat wave will likely be limited as consumer spending looks set to fizzle in the fall fallowing the summer boom, Mizuho Securities added.
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