|  | 14/09/2004 |
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The Long Agreement on Nippon Steel and Mitsui Mining Company
Nippon Steel and Mitsui Mining Company announced on that Mitsui Mining Company would resumed the coke oven in Kitakyushu that is stopping in April 2006, Nippon Steel would conclude the long agreement that purchase the blast furnace coke that produced there for ten years. Nippon Steel consumes the coke of about 12 million tonnes a year, and manufactures it of 11 million tonnes in the firm. Nippon Steel imports the coke of about a million tonnes from China, but it is difficult for the firm to get it stable because of the rapid expansion of the steel productions.
Then, Nippon Steel established the joint business venture that produces and sells the coke in Tianjin, and obtained the right to receive coke of 300,000 tonnes a year by priority. The long agreement with Mitsui Mining Company was decided as the policy following this.
Mitsui Mining Company has 4 ovens in the Kitakyushu office, but the one of them has been stopping since 1988. But Mitsui Mining Company have accouterment investment fund on loan in background of long-term trade, and resumed a coke oven. The investment is 12 billion yen. For this reason, annual cokes production of Mitsui Mining Company increased by 500,000 tonnes to 2.1 million tonnes.
The feature of this contract is that production can begin in a short term and the cost including fixed costs can decrease because it uses an existing infrastructure. Consequently, Nippon Steel can stably secure coke with competitive edge in short term, Mitsui Mining Company can expand the scale of the coke business that is the core business.
 Nippon Steel |
 
 | The Long Agreement on Nippon Steel and Mitsui Mining Company
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