Kobe Steel to Establish Welding Wire Plant in China

Kobe Steel announced on Thursday the firm establishes welding wire material plant in Tsingtao, Shandong, China, in April 2008, starting operation with initial capacity at 12,000 tonnes per year in April 2009. The capacity will be expanded to 24,000 tonnes per year in 2011. The new plant will produce flux cored wire (FCW) mainly for shipbuilding to meet strong demand along South Korean shipbuilders’ capacity expansion. Kobe Steel’s total FCW output capacity will increase by 20% to 144,000 tonnes worldwide, overseas capacity in which will up by 60% to 64,000 tonnes.Wielding material demand was 5.4 million tonnes globally in 2006, 2.5 million tonnes of which was consumed in China, according to Kobe Steel. Chinese shipbuilding capacity is expected to reach 28 million gross tonnes in 2010, almost double from 13.67 million gross tonnes in 2007.About 70% of Chinese shipbuilders’ welding material is coated electrode. Kobe Steel expects they would use FCW rather than coated electrode since FCW’s workability is superior by 3 times compared with coated electrode.The new plant will purchase materials, such as steel sheets, from Kobe Steel and other Japanese, South Korean and Taiwanese steel makers initially, while considering procurement from Chinese steel makers in future.The new plant will become Kobe Steel’s 10th overseas welding material base and the second in China.