Osaka Steel Advances Internationalization

Mr. Kazuo Nagahiro, president of Osaka Steel, Japanese major electric furnace steel maker, said Japanese GDP dropped for April-June when automobile industry or other manufacturing industry’s production decreased largely by disaster of the Great East Japan Earthquake, on interview by Japan metal Bulletin. Mr. Nagahiro said Osaka Steel accepted order from dealers which expects for demand of recovery in April, while decreased acceptance of order in May and June, decreased the sales volume decreased for April-June from the same period of last year. Mr. Nagahiro gave account the firm made effort for price hike, but ferrous scrap price increased, the consolidated sales decreased by 2.4% to 17.8 billion yen for April-June from the same period of last year, while the consolidated recurring profit slightly increased by cost reduction except for inventory write-down.

Mr. Nagahiro forecasted the consolidated recurring profit is 3.2 billion yen for April-September and 6 billion yen in the business year ending March 2012, the firm schedules periodic repair at each works for July-September, the business performance decreases for July-September, while isn’t going according to the plan by effect of the earthquake.

Mr. Nagahiro gave account the export ratio increased to about 30% to South Korea, Singapore, Hong Kong, Taiwan, North America and Australia for April-June due to low domestic demand, the export was firm for rail to mainly North America, but is decreasing due to high yen rate. Mr. Nagahiro aims the firm will increase the export ratio to over 10% in the business year ending March 2012, the firm will try the export. Mr. Nagahiro brings M & A in domestic and overseas business into view.

Mr. Nagahiro said Sakai works is improving billet continuous casting machine for increase of billet quality step by step from year befor last, the firm continues investment for products quality for consumers.

Mr. Nagahiro said the firm is advancing mutual consignment production of flat bar and square steel with Shinkansai Steel, Japanese major electric furnace steel maker according to plan, decided cooperative transportation for support of transportation of Shinkansai Steel when the subsidiary of Osaka Steel acquired credential which can transport except for Osaka Steel. Mr. Nagahiro thinks the firm will join hands for purchase with Shinkansa iSteel.

Mr. Nagahiro said the firm can purchase necessary quantity of ferrous scrap at best price and maintains most appropriate inventory by fairway management system, and will reduce material cost by the system.

Mr. Nagahiro said the firm aims best company and plans to reduce production cost, improve products and advance internationalization.