[Ferro-Alloys.Com]It is reported that JFE Holdings Inc, Japan's No 2 steelmaker, has slashed its full year profit forecast in half due to worries that a delay in the recovery of Asia's steel market and slower demand from carmakers will squeeze margins.

Japan's steel producers are also likely to suffer from a decline in demand from carmakers after the government endedincentives in September 2012 for environmentally friendly cars.

Political tensions between Japan and China, which erupted after a row over disputed islands led to violent anti Japanese protests across China, have also hurt sales of Japanese cars in China.

JFE, the world's ninth biggest crude steel producer by volume, swung to a recurring loss of JPY 5.8 billion, which is pretax and before one off items, in the July to September 2012 quarter from a profit of JPY 25.2 billion a year ago.

It expects JPY 45 billion in recurring profit for the year to March 2013, sharply below the JPY 90 billion which was forecasted three months ago. The new figure is below a consensus estimate of JPY 59.99 billion in a poll of 17 analysts in Thomson Reuters and compares with year ago profit of JPY 52.98 billion.

• [Editor:editor]