Japan’s biggest steelmaker, Nippon Steel Corp., said on Thursday one of the two steelmaking plants at its Kimitsu Steel Works will be shut until the end of December, to repair a chimney that collapsed in a typhoon last month.
The plant where work was suspended is located in Japan’s prefecture of Chiba east of Tokyo, the capital, and produces about 150,000 tonnes of semi-finished products each month to make wire rods used in automobiles, among other applications.
“We plan to complete repair work by the end of December and resume operations in January,” a company spokesman said.
Until then, Nippon Steel plans to produce substitutes at plants elsewhere as well as ask other Japanese steelmakers to provide substitute material to reduce disruption to supply for customers, including automakers, the spokesman said.
He did not elaborate, and declined to say what impact the suspension may have on the company’s earnings for the current financial year to March 31.
The typhoon in early September was one of the strongest to hit eastern Japan in recent years, killing one woman and bringing record-breaking winds and stinging rain that damaged buildings and disrupted transport.
The No. 1 steelmaking plant at Kimitsu, which makes semi-finished products using a basic-oxygen furnace to adjust iron ingredients, has halted operations since Sept. 9 after the chimney collapse, Nippon Steel has said.
Blast furnaces are operating at lower output to adjust to the reduced capacity of the steel-making process, the spokesman added, without giving specific volumes.
Another steelmaking plant at a Nippon Steel subsidiary in western Hiroshima, Kure Works, has also suspended operation since a fire damaged its operating room in late August, the spokesman added.
“We are still investigating the damage at the Kure Works and we don’t know when the plant will resume operations,” he added.
In early August, Nippon Steel forecast it would produce 41 million tonnes of crude steel for the year through March 2020, flat with a year earlier.
It also predicted a drop of 56% in annual profit, blaming an erosion in its margins on surging prices of iron ore and slumping demand in Asia.
(Reporting by Yuka Obayashi; Editing by Clarence Fernandez)
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