Japan Major 5 Steels Plan Higher Capital Expenditure in F2011

Japanese major 5 integrated steel makers’ consolidated capital expenditure increases by 2.1% to total 689 billion yen in construction base for fiscal 2011 ending March 2012 from fiscal 2010. Sumitomo Metal Industries, Kobe Steel and Nisshin Steel increase the expenditure while Nippon Steel and JFE Steel reduce the expenditure. They keep high level investment to improve manufacturing ability for better international competitiveness despite of the severe business condition.

Nippon Steel reduces the expenditure by 6.9% to 270 billion yen for fiscal 2011 from fiscal 2010. The firm improves the profitability with better competitiveness and increases high grade steel production. JFE Steel reduces the expenditure by 7.6% to 150 billion yen focusing on cost cutting effort after the firm established annual 33 million tonnes of raw steel output capacity in unconsolidated base.

Sumitomo Metals increases the expenditure by 18.3% to 130 billion yen for fiscal 2011 from fiscal 2010. The firm plans second phase of upstream renewal at Wakayama works and renewal of Corporate Research & Development Laboratories in Hyogo along with 10 billion yen of rebuilding project for damaged facilities by the major earthquake. Kobe Steel increases the expenditure by 26% to 115 billion yen mainly for renewal of power plant boiler at Kakogawa works and KOBELCO Construction Machinery’s Global Engineering Center and Itsukaichi plant in Hiroshima.

Nisshin Steel announced on Wednesday the firm increases the consolidated expenditure by 14.3% to 24 billion yen for fiscal 2011 from fiscal 2010 while the depreciation decreases to 38 billion yen from 38.5 billion yen. The firm plans refreshing of hot rolling facility and conversion of cooling system of No.2 blast furnace at Kure works. The firm also plans to refresh cold rolling facility at Shunan plant, continuous pickling facility and cold rolling facility at Sakai plant and conversion of continuous galvanizing line to make galvanizing steel with 6% aluminium and 3% magnesium, ZAM and color coating line restructure with the group company at Ichikawa plant.