Marubeni-Itochu Steel expands processing capacity of offshore steel service centers by around 25% to around 5 million tonnes per year in 4 years including new 3-year plan period from fiscal 2012 starting April 2012. The firm tries to follow growing offshore activity by automakers and other steel users. The firm already started expansion at Thai and Indonesian service centers while the firm studies expansion at center in northeast of China. The total capacity will reach 6.5 million tonnes including Japanese operations. The firm tries to expand the profit base for 10 years growth.
The firm plans 30-40 billion yen of investment in fiscal 2011, which is 1.5-2 times of fiscal 2010 level. Japanese automakers expand the offshore production to follow growing demand in emerging countries while they try to improve the competitiveness under higher yen rate. Marubeni-Itochu Steel’s president Kenichiro Ushino said the firm expands the offshore processing capacity and already has expansion draft in China, India, Indonesia and Mexico. He emphasized the firm tries to seek growth in rapid growing countries through aggressive investment. The firm eyes expansion of Dalian Teng Yang Steel Processing in China and building new plant in the world largest automobile making country. The firm starts cold finished strip production at Jiaxing Hongzhong Steel Processing in January 2012. The firm builds No.3 plant of United Coil Center in Thailand in November to meet growing demand from transplants of Japanese automakers and appliances makers. The firm improves the supply chain from upper stream operation including Thai Cold Rolled Steel Sheet to processing operations. The firm added tailored welded blanking machine at P.T. United Steel Center Indonesia while the firm launches cabin making operation through joint venture with Press Kogyo. Marubeni-Itochu Steel also tries to follow electrical steel demand in rapid growing Indian market by investing in local service center in November 2010. The firm has interest in 9 processing plants with total 1.32 million tonnes of annual processing capacity in Asia and Pacific area, 4 plants with 900,000 tonnes of capacity in China, 6 plants with 1.65 million tonnes of capacity in North and Central America and a plant with 30,000 tonnes of capacity in Europe. The firm also has interest in 11 plants with total 1.6 million tonnes of capacity in Japan. The total capacity is 5.5 million tonnes in the 33 plants. Mr. Ushino said such investment creates functions and the functions create trading business. The firm tries to expand investment in processing business. The investment was record 20 billion yen in fiscal 2010 compared with 3.5 billion yen in fiscal 2009. The firm improved competitiveness of US construction sheet processing through M&A. The firm tries to expand the business into pipe for energy industry, construction materials for infrastructure, plate and special steel for wind power generation.