March 13 (Bloomberg) -- Nippon Steel & Sumitomo Metal Industry Corp., Japan’s biggest steelmaker, plans to close a blast furnace at its largest mill near Tokyo to save costs as it seeks to become more competitive with Asian rivals.
The number three furnace at Kimitsu in Chiba prefecture will cease operations by the end of fiscal 2015, the Tokyo-based company said today in a statement outlining its mid-term plans. Nippon Steel will also postpone its Wakayama number two furnace operations, it said.
The closure comes as Chief Executive Officer Shoji Muneoka pushes to pare costs and to streamline operations at the company created by the merger in October of Nippon Steel Corp. and Sumitomo Metal Industries Ltd. The company in November raised its cost-saving targets by 33 percent to 200 billion yen ($2.1 billion) annually after three years of integration.
Nippon Steel & Sumitomo Metal inherited 16 steelworks in Japan with 14 blast furnaces, which use iron ore and coal as raw materials to produce the alloy. The company will secure employment by moving extra jobs to overseas facilities and affiliates, Muneoka said Sept. 26.
The shares rose 0.4 percent to 262 yen as of 3 p.m. in Tokyo trading, extending gains this year to 25 percent.
To contact the reporter on this story: Masumi Suga in Tokyo at firstname.lastname@example.org
To contact the editor responsible for this story: Jason Rogers at email@example.com