Nippon Steel to shut site; aims to save $2.1 bn

Japan's biggest steel maker Nippon Steel & Sumitomo Metal Corp (NSSMC) said yesterday that the company will shut down one of its blast furnaces, as part of its cost cutting measures to save up to ¥200 billion ($2.1 billion) annually to make the business globally more competitive and to take on Asian rivals.

Nippon's blast furnace No 3 at Kimitsu works near Tokyo will close down its operations by the end of financial year 2015, while the plant will continue production with its other two blast furnaces, the company said in its mid-term management plan released yesterday.

Tokyo-based NSSMC, formed through the merger of Nippon Steel and Sumitomo Metal Industries in 2012 is the world's second-largest steel maker behind Luxembourg's ArcelorMittal SA, with a capacity of around 37 million tonnes of crude steel per annum.

The company produces steel plates, flat products, rods and bars, pipes and tubes, railway and automotive parts, construction steel, special steel, as well as new materials and chemicals. The $43-billion steel giant employs around 60,500 people.

The global demand for steel is forecast to grow at a modest rate, while new plants in China and other Asian regions are expected to commence production in 2015.

Japan's steel demand is likely to stay at around 60 million tonnes per year, the company said.