SINGAPORE Japanese steelmaker JFE Steel Corp. has signed a joint-venture agreement to set up a steel pipe plant in Chinas Zhejiang province to target automotive producers, it said May 16.
The new company, Jiaxing JFE Precision Steel Pipe Co. Ltd., will manufacture and sell small-diameter electric-resistance welding (ERW) pipes and cold-drawn steel pipes. It will employ about 100 people, JFE Steel said.
With capital of 96 million yuan ($15.5 million), the joint venture is 36-percent held by JFE Steel, 15-percent held by JFE Steel affiliate Kawasaki Kokan Co. Ltd., 10 percent by Marubeni-Itochu Steel Inc. Tokyo, 20 percent by Marubeni-Itochu Steel Inc. Hong Kong, and 19 percent by Shuan Hwa Industrial Co. Ltd., Taiwans largest cold-drawn pipe manufacturer.
Construction of the 2,000-tonne-per-month facility is expected to be completed by September 2014, while production starting in January 2015. With automobile production forecast to continue growing in the country, demand for automotive steel pipes is expected to expand steadily, JFE Steel said.
A version of this article was first published by AMM sister publication Steel First.