Nippon Steel to Launch Joint Wire Processing Plant in China

Nippon Steel announced on Tuesday the firm establishes cold heading wire making plant in Suzhou, Jiangsu to supply the products for local plants of Japanese automotive parts makers. The firm with the partners builds plant with annual 7,000 tonnes of processing capacity as the first phase for 300 million yen starting operation in early 2007. The plant is the first Chinese business in wire processing for Nippon Steel. The firm decided the investment after the study through Nippon Steel Bar & Wire, which is special bar and wire processing offshore business planning joint venture with Tokyo based wire processor, Matsubishi Metal Industry, Nagoya based wire processor, Miyazaki Seiko and Osaka based wire processor, Sanyu. The 4 firms, Toyota Tsusho Corporation, Metal One and Nippon Steel Trading join the new plant. They establish joint venture in September. Nippon Steel has 28% interest in the venture. They secure 3,000 square meters of plant building in industrial park in Suzhou. Nippon Steel supplies wire rod from Muroran works to the new plant. The plant will make products with 5-15 millimeters diameter with 2 drawing lines. The plant is to meet higher demand from local plants of Japanese auto parts makers when Japanese automakers expand the output in China. Japanese automakers try to shift the materials and parts purchase to local procurement from current import from Japan. Nippon Steel tries to keep studying for another chance in offshore bar and wire processing business. The firm keeps finding new business through Nippon Steel Bar & Wire, in which the firm has 40% interest with 20% by Matsubishi, Miyazaki and Sanyu each.