Japan July rolled copper output down 4.1pc yr/yr

TOKYO: Japan's output of rolled copper product dropped 4.1 percent in July from a year earlier, its second consecutive year-on-year fall, due to sluggish demand from auto and chip makers, an industry association said on Friday.

The preliminary data from the Japan Copper and Brass Association showed that rolled copper output totaled 71,978 tonnes in July on a seasonally adjusted basis. That marked an increase of 2.8 percent from June.

"The impact of a steep fall in car output in the aftermath of the devastating earthquake in March has become apparent in the past few months," the association said. "But production of air conditioners remained solid despite the fact that the peak season for their demand has passed."

Demand for copper, used in a wide range of items including construction materials, computer chips and car parts, is often seen as a measure of economic activity.

The magnitude 9.0 earthquake and ensuing tsunami that devastated northeast Japan forced Japan's top carmakers to slash output by up to 80 percent in the April-June quarter due to disruptions to the supply of parts.

With supply chains almost restored, the makers are raising production to make up for the post-quake slump and are expected to produce 5.3 million to 5.7 million cars in the September-March second-half, up more than 40 percent from 3.2 million units in the first-half.

Japan's business mood improved in August and is expected to brighten further as manufacturers restore output to pre-disaster levels, a Reuters poll showed, but a rising yen and slackening foreign demand have started taking their toll on exports.

Copper wire and cable producers, Japan's biggest copper users, said last week that wire and cable shipments in July fell 7.5 percent from a year earlier to the lowest on record for the month, citing a steep fall in exports, mainly to China, and a 5.4 percent decline in domestic demand.

Copyright Reuters, 2011