Japan Dec industrial output falls 1.2 pct on electronics adjustments -
Friday, January 28, 2005 2:51:31 AM
afxpress.com
TOKYO (AFX) - Industrial output in December fell a seasonally-adjusted 1.2 pct from the previous month, amid continued adjustments in the electronics device sector, preliminary data issued by the Ministry of Economy, Trade and Industry (METI) showed, The output performance was broadly in line with market expectations
METI also forecast that production in January will increase 2.8 pct, but fall 1.2 pct in February. Production in December at the nation's factories and mines was expected to decline 1.3 pct, according to the average forecast of 22 research houses polled by the Nihon Keizai Shimbun. The forecasts ranged from a decline of 2.5 pct to no change
METI itself forecast last month that output would fall 0.9 pct in December
Year-on-year, output increased 1.4 pct
In November output rose 1.7 pct month-on-month, and by 4.5 pct from a year earlier. Citing the rapid slowdown in production in the electronics sector, which had supported overall output until early this year, METI noted that the upward trend in production has now flattened
Until August, the METI had said that industrial production was on a rising trend
In December, overall industrial production showed a downturn from the previous month, as the closely-watched electronics sector slashed output, according to the METI
Production in the electronic devices sector fell 1.7 pct in December from the previous month, the fifth fall in the past seven months. It was led by an 8.9 pct reduction in output of active matrix liquid crystal displays (LCDs)
"While the production of electronic devices used in PCs was comparatively solid, output of devices for cellular phone handsets was weak," a METI official said. "While there is a mixed bag of trends amongst makers, we understand that the electronic devices sector, as a whole, remains in an adjustment phase." Production in the information and telecom equipment sector, covering digital cameras and cellular phone handsets, fell 4.9 pct in December from a month earlier
Japan's largest electric device maker Kyocera Corp yesterday slashed its forecast net profit to 59 bln yen from 85 bln, citing the sharp downturn in demand from handset and digital camera makers
The country's largest DRAM maker Elpida Memory, the second-largest semiconductor maker NEC Electronics, and Sony have also issued profit-warnings in the past two weeks, hit by the slowdown in the digital products market
"Judging from the silicon cycle, production in the electronic devices sector is not likely to see a notable rebound until around mid-2005," Daiwa Institute of Research senior economist Junichi Makino said
In December, production of flat panel display manufacturing equipment sector fell 11.9 pct from November
In December, production in the auto sector also dropped 3.0 pct from the previous month, but the METI official downplayed the significance
"Procurement difficulties at some automakers, as well as a fire were the the cause of the decline, as well as a lack of new model launches," the official said
"But, we believe that production activity in this sector is basically solid," he added
Mazda Motor Corp said yesterday it plans to resume full production at its Ujina No 1 plant in April, after halting operations there following a fire on December 15
A steel shortage problem however may be set to hurt the auto sector further with Nissan Motor Co Ltd president Carlos Ghosn saying recently has that the country's second largest carmaker might be forced to reduce its domestic production in March by 15,000 vehicles due to steel shortages
In the October-December quarter, industrial production fell 0.8 pct from the previous quarter, marking the second straight sequential drop. Year-on-year though output in the quarter was up 1.7 pct, the 10th straight annualised quarterly rise
Shipments increased by 0.1 pct in the Oct-Dec quarter from the previous quarter, the second rise in three quarters, and were up 1.9 pct from the year ago period, the 10th straight annualised quarterly gain
Inventories fell 2.3 pct in the Oct-Dec quarter from the previous quarter, the second fall in the three quarters, while dropping by 0.7 pct from a year ago, the second straight annualised quarterly fall
In 2004, industrial production overall jumped 5.5 pct, the second straight annual rise, thanks largely to buoyant output early in the year
Shipments in 2004 rose 5.3 pct, the second straight year of gain, while inventories fell 0.7 pct, the fourth straight year of decline |
