Nippon Steel Corp. said Thursday it will idle one of its three blast furnaces in Kimitsu, Chiba Prefecture, in late February to adjust for a sharp drop in demand for steel from automakers.
The company also has said it will start refurbishing a blast furnace in Oita Prefecture in February instead of its originally schedule time in March.
Nippon Steel and other Japanese steelmakers have been reducing output in line with dropping demand from automakers since October, when the global economy started entering a full-blown slowdown.
Among other steelmakers, JFE Steel Corp. has also started refurbishing a blast furnace in Kurashiki, Okayama Prefecture, ahead of schedule.
Nippon Steel also lowered its fiscal 2008 earnings forecasts from late October after factoring in drops in shipments, extra costs linked to production cuts and appraisal losses on securities holdings. Fiscal 2008 ends March 31.
Its group net profit estimate for the year was reduced from ¥330 billion to ¥175 billion, down 50.7 percent from the previous year. The projection for group sales was cut from ¥5.40 trillion to ¥4.75 trillion, down 1.6 percent.
For the first three quarters of fiscal 2008, Nippon Steel reported a ¥212.11 billion group net profit, down 19.4 percent from a year earlier, on ¥3.83 trillion in sales, up 9.2 percent.