JFE Steel Examines Establishment of First Steel Powder Plant in Emerging Country

JFE Steel examines establishment of its first steel powder plant at overseas during the next mid-term management plan for fiscal 2012-2014 ending in March 2015. JFE Steel plans to start local supply of steel powder when Japanese customers, mainly car industry, are accelerating offshore productive operations. Potential locations are ASEAN, China and India. JFE Steel also seeks joint business partners such as local steel makers. Steel powder consumption is expanding in emerging countries while sales competition is becoming severer with overseas steel powder makers. JFE Steel aims to follow the demand growth by utilization of overseas production base with high cost competitiveness.

Mr. Susumu Moriyasu, chief of JFE Steel’s steel powder sector, said the sector is designing the business strategy over the next 10 years. Steel powder is mainly used for sintered parts or magnetic materials. About 70% of JFE Steel’s steel powder sales is for automobile industry. At overseas, major steel powder makers including Heganes of Sweden, Heganes Corporation of the U.S.A., and Kebekku of Canada, are expanding their market shares. JFE Steel also accelerates overseas productive operation.

JFE Steel is the only Japanese maker to produce atomize steel powder, reduced iron steel powder and alloy steel powder totally. The firm will renew 3 powder machines for sponge iron in Chiba area of East Japan Works during fiscal 2011-2012 and improve the productivity. The firm also focuses on new product development and eyes installment of necessary facilities.

JFE Steel’s steel powder production increased by 6% to 63,000 tonnes in fiscal 2010 from the previous financial year along car market growth. The production decreased by 10% for April-June 2011 from the original output plan due to aftermath by the mega earthquake disaster. The volume is currently increasing by 10% for July-September from the original output plan. The firm expects the production could exceed the original planed volume in the last half of fiscal 2011 along car makers’ output increase.