North Japan earthquake disrupts steel operations

The large earthquake that hit northern Japan late on March 16 forced some local steel mills to halt steel production temporarily out of safety concerns, steel mill sources confirmed late Thursday.

A strong 7.3-magunitude earthquake hit the Tohoku region in northeast Japan including Fukushima and Miyagi prefectures just before midnight, claiming four lives and injuring more than 150 across both prefectures and shutting down electricity supplies to over 2 million households in a wide area including Tokyo. Roads and rail lines were also damaged.

Nippon Steel, the country's largest integrated mill, confirmed that several facilities at the Kamaishi area works in Iwate prefecture in northern Japan were idled while safety checks were conducted. Those at its two huge integrated steel plants near Tokyo also belonging to East Nippon Works �" the Kashima Area plant in Ibaraki prefecture and the Kimitsu Area works in Chiba prefecture �" were also briefly stopped but were returned to operation after inspections confirmed no risks to safety.

"No major damage was found, and we expect all will return to normal operation very soon," a Nippon Steel official commented Friday.

JFE Steel, Japan's second-largest integrated mill, also halted some facilities temporarily at its Sendai Works in Miyagi prefecture immediately after the quake for safety inspections. Facilities were progressively restarted after checks were completed, a company official disclosed. The Sendai Works is producing mainly special steel longs and hosts an electric arc furnace.

A Tokyo-based steel trader learned that some distributors in the area had received damage to steel storage facilities, and some steel buyers were forced to stop operations for safety checks or because of damage to their production lines. Delivery delays are also anticipated because of damage to roads in the area. "It will take some time to determine the actual impact from the earthquake and aftershocks," he said.

Toyota Motor, Japan's largest automaker for example, stopped operations at three plants in Miyagi prefecture immediately following the earthquake for workers to evacuate and to conduct safety checks. The lines remained idled all of Thursday but were to be restarted from Friday, Mysteel Global noted.

The trader said there was no major damage to steel-related facilities because steel producers have been taking counter-measures for earthquakes, having learned from experiencing the Great East Japan Earthquake in March 2011.

"But the Japan Meteorological Agency (responsible for disaster recovery) is warning that aftershocks will probably continue for about a week, so companies in the region will continue operating cautiously," he added.

Written by Yoko Manabe, yoko.manabe@mysteel.com

This article has been published under an exchange agreement between MySteel Global and SteelMint.