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Natural disasters

Full economic impact of Japan typhoon still unknown 2 weeks later

Factories forced to cut production as power outages persist

A pile of rubble and a damaged house in Kyonan, Chiba Prefecture.   © Kyodo

TOKYO -- Authorities are finally starting to grasp the damage to homes and factories from the powerful typhoon that slammed into Japan two weeks ago, but with some areas still without power, no one knows the full extent of the economic loss.

Roughly 3,000 homes still did not have power in Chiba Prefecture, which neighbors Tokyo to the east, as of Sunday night, according to Tepco Power Grid. The Tokyo Electric Power Co. Holdings unit says it aims to bring the lights back on in most of those homes by Friday.

But factories and farmers continue to feel the impact from the blackout and physical damage to facilities.

At Nippon Steel's steelworks in Kimitsu, Chiba Prefecture, some equipment handling a key process has been forced to shut down because the wind knocked over a smokestack used for gas processing. This has impacted production of semi-finished products used to make steel cord that strengthens automobile tires -- a product for which the company commands a large global market share. Nippon Steel has not said when it will resume production, but output could be down for months.

For now, Nippon Steel will consider making the product at its other facilities or buying from other companies.

Itoki, a major office furniture manufacturer, has been unable to procure parts because subcontractor factories stopped running due to the blackout. Although it is trying to procure those parts from partners outside of Chiba, shipments of some products remain stopped.

Some companies that produce bento box meals and prepared dishes for Seven-Eleven Japan partially resumed operations at factories in Sodegaura, Chiba Prefecture, but output is at less than half of normal levels. About 100 part-time workers -- roughly half the total -- have been unable to commute to the plants because of damage to their homes or impassable roads.

In Chiba, shipments of raw milk have recovered to around 80% of pre-disaster levels. But an official with the prefecture's government said that "the impact on facilities and dairy cattle has been large, so it will take some time to return to levels from before the blackout."

Unable to receive sufficient supplies of raw milk, Megmilk Snow Brand cut shipments of some dairy products made in Chiba. Peers such as Morinaga Milk Industry have also reduced shipments in greater Tokyo.

Poultry farms were also hurt by the blackout as machines for ventilation and feeding stopped. Egg prices have gone up because of the reduced supply from Chiba, a major production center. A benchmark price was 195 yen per kilogram for medium eggs as of Friday, up about 20% from Sept. 6.

"The livestock industry is still affected, so we haven't been receiving sufficient supplies of products such as milk, yogurt and eggs," said an official at Aeon Retail.

Noting that pears have been blown off trees on farms in Chiba, the official said his company will consider purchasing such produce as carrots and green onions from other prefectures because shipments from Chiba may be affected in October and afterward.

As of Friday, damage to Chiba's agriculture, forestry and fisheries industries was estimated at 28.36 billion yen ($260 million). Small and midsize businesses are believed to have suffered more than 30 billion yen in damage to offices and factories, but this does not include losses stemming from production halts due to power and water supplies being cut off.

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