Nippon Steel and Sanyo Special Steel Expand Special Steel OEM

Nippon Steel and Sanyo Special Steel start mutual OEM of special steel bar and wire rod in fiscal 2008 starting April. Nippon Steel supplies alloy steel for machine structural use and Nippon Steel & Sumikin Stainless Steel, a subsidiary of Nippon Steel, supplies stainless wire rod to the customers of Sanyo Special Steel. Sanyo Special Steel supplies bearing steel to the customers of Nippon Steel. Both companies aim to streamline their production and to response to the strong demand. Both companies will increase the supply volume of mutual OEM to 1,000 tonnes per month until the end of fiscal 2007 and to 3,000 tonnes in near future.Both companies reached to an alliance agreement in February 2006 for the enhancement of the competitive force for special steel businesses. They advanced the inspection for mutual OEM, cooperation of material purchasing and product transport or people-to-people exchange for research and development. They additionally got mutual share.The demand for special steel bar and wire rod is expanding mainly for automobile and construction machine. Japanese integrated steel makers and special steel makers are increasing their production capacities. Nippon Steel and Sanyo Special Steel focus their production of SC Steel to Nippon Steel and of bearing steel to Sanyo Special Steel, which aim to expand their production volume by effective utilization of the material.Nippon Steel is relegating the production of high grade wire rod for cold header product of Muroran iron works to Kamaishi iron works and Kimitsu iron works, and the production of Kamaishi and Kimitsu iron works to NS Bousen which is Nippon Steel Group Company.Sanyo Special Steel is Nippon Steel Group Company. Nippon Steel will accelerate the optimization of the production for special steel bar and wire rod by the expansion of mutual OEM with Sanyo Special Steel.