JFE Steel to Expand UOE Pipe Output Capacity at Fukuyama

JFE Steel expands annual output capacity of UOE large diameter steel pipe at Fukuyama area of West Japan works for around 6 billion yen. The firm increases the capacity from current 400,000 tonnes at the products mix to 600,000 tonnes by mid-2011 while the line starts production of X100 grade pipe of American Petroleum Institute and expands the products range for thicker products.

JFE Steel makes UOE pipe at Fukuyama and Chiba area of East Japan works. The capacity is annual 200,000 tonnes at Chiba and 400,000 tonnes at Fukuyama at current products mix. The firm already completed the development to make X100 grade high strength pipe.

Worldwide UOE pipe demand will increase for line pipe applications when many projects are planned to develop natural gas pipeline to meet growing demand for clean energy. The pipe demand is expected to increase for premium products including high strength pipe with X100 or higher grades and thicker pipe to distribute gas inner continents at longer distance and severe conditions including high pressure, often earthquake and frozen land.

The demand decreased in fiscal 2009 ended March 2010 due to demand slump for energy development after financial crisis. The demand is expected to be slow and the pipe supply could be loose in fiscal 2010 when major projects start in and after fiscal 2011.

JFE Steel started the expansion at the export base of Fukuyama to improve the competitiveness through better productivity. The firm apparently eyes closure of UOE line at Chiba to improve the efficiency depending on the expansion work at Fukuyama.