TOKYO JFE Steel Corp. is looking to slash its costs by 100 billion yen ($1 billion) in the current fiscal year starting April 1, with a big focus on reducing its raw material expenses.
"About 70 percent of our planned savings for this year will come from reducing costs in our upstream operations, and will include a combination of modernizing old equipment for higher productivity and by using lower-grade coal and iron ore," a company executive told AMM sister publication Steel First.
The company has earmarked some 200 billion yen ($2 billion) in capital spending for fiscal 2013, much of it for upgrading its facilities and installing new equipment for pulverizing, transporting and injecting low-grade coal at its eight Japanese blast furnaces.
It also plans to use more low-iron-content iron ore to help boost profitability after its pre-tax profit for fiscal 2012 fell 40 percent to 15.3 billion yen ($156 million).
A version of this article was first published by AMM sister publication Steel First.