Itochu Corp. to Invest 150 Billion Yen for Metals, Minerals

Itochu Corporation’s metals and minerals company plans around 150 billion yen of investment in fiscal 2012 started in April. While the investment is less record 270 billion yen in fiscal 2011, the unit keeps investing mainly for expansion of existing projects including Australian iron ore joint venture. The unit is careful for new investment while the unit still seeks opportunity of investment in base metals. The unit expands stable sources of steel materials, metals and minerals through expansion and development for existing projects.

The firm increased the investment budget by 200 billion yen to 1 trillion yen for 2-year plan through fiscal 2012 from original plan. The firm increased the budget by around 150 billion yen to around 600 billion yen for resource and energy. The firm allocates around 150 billion yen to metals and minerals unit out of around 220 billion yen budget for resource and energy in fiscal 2012. The unit increases the investment for existing items while the unit reduces the investment for new items.

The metals and minerals company president Ichiro Nakamura said the unit tries to secure base metal interests. He said the unit keeps studying potential investment for new coal mine but the unit carefully selects the items with cost competitiveness and some excellences.

The unit expands interests in iron ore and coal and increases the resource items into base metals and rare metals in longer term while the unit expands trading functions. The unit increases primary aluminium ingot sales from Middle East and expands trading of metal scrap and nonferrous metals products through the subsidiary while the unit expands cooperation with Marubeni-Itochu Steel.

The unit posted record 142.1 billion yen of net profit for fiscal 2011, which was 28% higher than fiscal 2010 level thanks to higher price and iron ore volume. The unit expects 109 billion yen of net profit for fiscal 2012 due to lower price despite of higher volume for iron ore and coal.