Essar Steel, Kobe Steel to Study for Automotive Steel JV

Japanese integrated steel makers and Indian major steel makers deepen the cooperation. Essar Steel announced on Wednesday the firm signed memorandum of understanding with Kobe Steel for collaboration of technology for manufacturing high strength steel. They conduct a feasibility study on establishing joint venture with continuous annealing line and continuous galvanizing line. Nippon Steel, JFE Steel and Sumitomo Metal Industries are separately building a collaborative relationship on manufacturing automotive steel with major Indian steel makers. Japanese integrated steels build automotive steel supply network in India from 2012 to 2013.

Essar Steel and Kobe Steel study potential joint venture in design, construction, operation, production volume and investment value for a year. They eye potential joint venture to make high tensile flat steel by building continuous annealing line or continuous galvanizing line or both of the lines. With feasible results, the plant could start the operation as early as in 2013 after 2 years construction.

Nippon Steel establishes joint venture with Tata Steel to start production of automotive cold rolled flat steel by March 2013. They are discussing potential cooperation in upstream operation. JFE Steel already has around 15% share in JSW Steel and provides technical support for JSW Steel to make automotive cold rolled flat steel. JFE Steel also studies possibility to participate in steel works project of JSW Steel. Sumitomo Metals provides technical support to Bhushan Steel in automotive cold rolled flat steel making and blast furnace operation. Sumitomo Metals also eyes potential participation in Bhushan Steel’s new steel plant project.

Japanese manufacturers accelerate to enter into emerging countries to follow growing demand partly with advantage of higher yen rate. India is growing as export base of automobile for Japanese automakers as Mexico after established bases of Japan, USA, China and Thailand. The steel users try to use local steel products. JFE Steel already decided to build continuous galvanizing line in Thailand and other Japanese steel makers also try to build local supply base for the users.