Kobe Special Tube to Regain Black at 1,100t/m Production in F2010-2011

Kobe Special Tube, Kobe Steel’s 100% subsidiary to produce seamless pipes, plans to build up the earning capacity to regain surplus even at the production of 1,100 tonnes per month by productivity improvement and cost reduction in fiscal 2010-2011 ending in March 2012. The firm tries to increase order acceptance of seamless stainless steel tube in Japan and at overseas when the demand is expected to increase in oil, chemical or energy industries.

The firm produces seamless stainless steel tube, precision tube, special tube and welded titanium tube. The production decreased by 25% to 1,000 tonnes per month in fiscal 2009 from fiscal 2008. Mr. Terumichi Abe, Kobe Special Tube’s president, explained the firm posted wide loss in fiscal 2009 despite of 20% cost cut due to slow sales, high productive costs and inventory evaluation loss. The firm aims to return into the black in fiscal 2010.

At overseas, oil, electric power and gas industries are restarting postponed projects and seamless stainless tube demand is expected to increase. In Japan, Kobe Special Steel tries to increase the sales volume by utilizing domestic distributors’ network. As to welded titanium tube, the firm plans to increase the production by 20% in fiscal 2010 from fiscal 2009 in cooperation with Kobe Steel. The firm eyes capacity expansion to follow strong needs from atomic power plants.

At the same time, the firm will develop new products and increase size variations when the demand is increasing for high temperature and pressure seamless tubes.