3/28/2011 2:15:00 PM
HEADLINES
Fastener Supply Chain Sees Ripple From Japan Disaster
While Japan struggles to deal with the devastation caused by the March 11 earthquake and tsunami and resulting nuclear crisis, early industrial reports indicate the effect on the fastener supply chain.
The biggest concern among fastener professionals centers around the backlash from OEM production. Manufacturers in Japan, including Honda Motor Company, shut down production, causing a short-term reduction in fastener demand. The production stoppage could also affect OEMs outside of Japan who rely on Japanese suppliers for critical parts.
U.S. fastener companies with facilities in Japan expect a long recovery from the series of disasters rocking the island nation. A 9.0 magnitude earthquake hit Japan’s northeastern coast, followed by a 30-foot tsunami, which resulted in a partial meltdown of at least one nuclear reactor in the area.
Rockford, IL-based Rocknel Fastener has a plant about 100 miles north of the disaster area in Japan. While its facility was not damaged, the automotive fastener manufacturer’s largest customer is Honda, and Rocknel president David Sato told WIFR TV that it will be a long time before most of the carmaker’s plants resume full production.
• Bob Sachs of XL Screw Corporation reported most Japanese fastener manufacturers are in the Osaka area.
“We do not have any suppliers currently in Japan, but I have been in touch with Eddie Wakayama, who was a valuable XL employee for 30 years,” Sachs reported. Now retired Wakayama responded that he and “our fastener friends and their factories are fine.”
In 2010 Japan’s total fastener export amounted to 325,604 tons worth 257.19 billion yen. The top three export countries are China, the U.S., and Thailand.
• Importer and master distributor Porteous Fastener Co. does not buy fasteners from Japan, but materials VP Bruce Darling told FIN the crisis is already affecting supply.
“We do know that steel and stainless steel wire rod will be affected,” Darling told FIN.
Nippon Steel has five plants in Japan, including two within damage area. The Kimizu plant has four furnaces that are believed to still function. The Kamaishi plant has no furnace but re-works wire and bar and the plant had damage and is not working now. So far there is no estimate on how long it will be down.
Darling checked with retired Porteous employee YamaYamamoto, who now lives in Kobe – south and west of Tokyo. Yamamoto told Darling a Nippon Steel mill which produces wire rod and bars was damaged by the tsunami and shut down pending repairs.
One of Sumitomo Steel’s three plants is located in the quake area. The Kashima plant had two furnaces damaged by the quake. Repairs are underway.
JFE Steel’s Chiba plant had five functioning furnaces before the quake hit, knocking the facility offline. This plant produces mostly sheet steel and stainless sheet steel for the automotive industry.
“Even if these plants begin producing quickly there will be interruption of service,” Darling noted. “Once re-construction begins much of the steel will be diverted to re-construction.”
“Certainly medium carbon and high carbon steel and stainless steel has been affected. Electricity is still a bit uncertain,” said Darling.
“We expect Grade 8 Cap Screw and Socket steel (will) be effected as well as stainless wire rod.”
Japan fastener imports jumped 27% to 203,788 tons in 2010, with the value gaining 16.2% to 62 billion yen. ©2011 GlobalFastenerNews.com
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