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Baosteel to cut capacity by 30% in Shanghai
Aggregated Source: Shanghai Daily: Business

BAOSTEEL Group Corp has started piling work for the No. 1 blast furnace of its Guangdong-based Zhanjiang plant, seen as a "key battlefield" as it bids to cut 30 percent of its capacity in Shanghai.

The first batch of piles was driven into the ground for the first blast furnace last Friday, marking the start of the ''overall construction period'' for the main facilities at the US$11 billion project in south China, Baosteel said in a newsletter yesterday.

The furnace will become operational by the end of 2015, it said. Construction on a second furnace will start in June next year and be completed in 2016. The building of the other main units, including steel making, hot rolling and cold rolling facilities, will begin between July and September this year, the firm said.

Shanghai-based Baosteel sees the 10 million-ton-a-year Zhanjiang project as a "key battlefield" for its "second pioneering" when production starts - part of the company's masterplan to cut 30 percent of its capacity in the city over five years.

It is also moving operations to resource-rich Xinjiang Uygur Autonomous Region where it has acquired a local steel company.

Baosteel said yesterday it has done a "reexamination and restudy" of the production process, management model and investment control at the Zhanjiang project since May last year when a ground-breaking ceremony was held.

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Copyright Shanghai Daily: Business