Ukraine conflict prompts Japan to look for alternative sources of raw materials

Mar 15, 2022 | News On Japan

Mar 15, 2022 (phnompenhpost.com) - Japanese manufacturers are starting to explore alternatives to Russia in sourcing their raw materials, as concerns about supply stability are growing due to the disruptions in production and logistics associated with the country’s “special military operation” in Ukraine.

Material prices on international markets are rising, making it difficult for makers to switch suppliers.

“If the situation drags out, the raw materials we used to purchase from Russia and Ukraine will need to be obtained through alternative avenues. We are preparing for that,” Nippon Steel Corp executive vice-president Shinichi Nakamura told reporters last week after discussing the situation in Ukraine with officials of the Ministry of Economy, Trade, and Industry.

Nippon Steel imports iron ore from both Russia and Ukraine, as well as coking coal from Russia. The two countries account for about 14 per cent of the company’s total iron ore pellet imports.

For now, the company will continue production using existing inventory, but it plans to increase procurement from Australia, Brazil, and elsewhere if the fighting continues.

JFE Steel Corp imports 18 per cent of its coking coal from Russia and is considering alternative supply options such as Australia and Canada.

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