NSSMC: Capacity Expansion of the Automotive Steel Sheet Joint Venture in China

nssmcNippon Steel & Sumitomo Metal Corporation (“NSSMC”) and Baoshan Iron & Steel Co., Ltd. (“Baosteel”) have been planning to construct the fourth hot-dip galvanizing line at a site neighboring the existing lines in BNA (Baosteel-NSC Automotive Steel Sheets Co., Ltd.), the joint venture between Baosteel and NSSMC, which operates within the compound of Baosteel in Shanghai, responding to the growth in demand for galvanized steel sheet (GA) for automotive use mostly from Japanese auto makers further building up their capacities in China, and also responding to their needs for Advanced High Strength Steel to permit further weight reduction for better performance in fuel economy, with automotive demand expanding in China.  BNA has now obtained approval of the project from the government of the City of Shanghai. This is a major investment for capacity increase following the third hot-dip galvanizing line, which was put into operation in 2010. This new line, though similar in type to the existing first and third hot-dip galvanizing lines, is additionally capable of manufacturing Advanced High Strength Steel  materials (e.g. galvanized dual-phase 980 steel), with a production capacity of 420,000 tons/year of high-grade automotive galvanized steel sheet. The start of operation of the new line is slated for 2015.

<Outline of the new line>
– Name: No. 4 hot-dip galvanizing line (No. 4 CGL)
-Production capacity: 420,000 tons/year
-Investment: about 1,100 million yuan
-Location: site adjacent to the present BNA (within the compound of Baosteel)
-Start of operation: 2015 (plan)

(Reference) Profile of BNA
-Name: Baosteel-NSC Automotive Steel Sheets Co., Ltd.
-Establishment: July 2004
-Business: Manufacture and sale of automotive steel sheet (cold-rolled steel sheet, hot-dip   galvanized steel sheet, etc.)
-Product: Cold rolled steel sheet, hot-dip galvanized steel sheet (primarily for automotive use, partly for electric appliances and construction materials)
Pickling/cold rolling: 2.4 million tons/year
Continuous annealing (C.A.P.L.): 950,000 tons/year
No. 1 hot-dip galvanizing line (No. 1 CGL): 450,000 tons/year
No. 2 hot-dip galvanizing line (No. 2 CGL): 350,000 tons/year
No. 3 hot-dip galvanizing line (No. 3 CGL): 450,000 tons/year (operative in 2010)
-Employees: about 650
-Registered capital: 3,000 million yuan
-Equity ratio: NSSMC 50%, Baosteel 50%