JFE Container Aims 10M Drum Can Production in F2011

JFE Container, the largest maker of drum cans in Asia, aims to expand its drum can production to 10 million cans per year during the next mid-term management plan for fiscal 2009-2011 ending March 2012, increasing by 34.4% from fiscal 2007. The firm plans to bring JFE Steel Drum (Zhejiang), a subsidiary established in Zhejiang, China in June 2008, into full production at 1.8 million drum cans per year. Meanwhile, JFE Container will establish the third Chinese plant around Nanjing to increase overseas production.

The firm has studied business feasibility for the third Chinese plant with strong interest. JFE Container already operates one subsidiary and plans to establish another plant in eastern China, where there exists a drum can market at approximately 12 million cans per annum. The market is expected to grow up by 33% to 16 million cans per year in 2011 which would exceed Japanese domestic drum can shipment.

Drum can production at JFE Container’s Chinese sites is currently lower by about 20% from a year earlier when chemical product prices are declining. JFE Container waits for the economic recovery and starts construction of the new plant.

Greif of USA, the world largest drum can maker, has expanded its global production including M&A and recently established a new plant in Tianjin, China. JFE Container also eyes M&A possibility at overseas while the firm considers whether high value added products can be manufactured at a purchased local plant.