Japan’s largest steelmaker, Nippon Steel Corp, plans to nearly double its crude steelmaking capacity at its Hazira plant in India to further secure the growing market. The expansion plan comes with concerns despite growth about the decline in the global economy with rising interest rates and weaker demand in China, the largest buyer.
“We are accelerating investment in India,” Takahiro Mori, executive vice president of Nippon Steel, told Reuters Steel on Tuesday will grow noticeably.” In 2019, Nippon Steel and Arcelor Mittal jointly bought bankrupt Indian company Essar Steel, now called AM/NS India, and are considering expanding the business. The annual production capacity at the Hazira plant in western India would increase from around 8 million tons to 14 to 15 million tons as a result of the construction of new blast furnaces. it said, without giving a value for the new investment or other details.
Steelmakers face an uncertain outlook as the prices for coking coal, iron ore, and other commodities fluctuate Ukraine crisis and China’s weak steel production. Coking coal is now unusually trading at a large discount to thermal coal, which is mainly used in power generation, which is booming due to disruptions in the Russian energy supply. . Nippon Steel sometimes used coking coal as an alternative to thermal coal because only a certain grade of coking coal could be used for this purpose, Mori said.
In August, Nippon Steel forecast a decline in full-year net income, a smaller decline than analysts had expected, said, which could mean more prices despite lower production. Nippon Steel, which is now in final talks with automakers and other major customers, wanted October-March sales prices by at least 40,000 yen ($287) a ton increase period compared to April-September, Mori said.
We have borne the brunt of higher material costs and the lower yen,” Mori said. “We are determined not to back down from passing higher costs on to product prices.AM/NS India said last week that it has some Essar Group infrastructure assets for 2, 4 billion dollars to strengthen its steel business. The acquisition gives AM/NS more flexibility to grow its business,” said Mori.
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