4:57:52 PM | 13/11/2008
Japan’s JFE Steel Corp. said November 11 it may cancel or suspend projects to build integrated steel mills with a combined investment of US$10 billion-US$12 billion in Vietnam and Brazil if demand remains weak, the Thanh Nien Daily newspaper reported.
Earlier, the world’s third-biggest steelmaker had officially proposed the Vietnamese government to help in detailed feasibility study for the US$5-billion steel complex with an annual capacity of 6 million-10 million tons in Dung Quat Economic Zone in central Quang Ngai province.
JFE Steel is cautiously assessing the feasibility of the projects now that steady demand growth in the global steel market was unlikely amid recession fears, said Hajime Bada, JFE Steel’s president and chief executive officer.
If the demand is shrinking and JFE Steel finds the projects are not feasible, it could cancel or suspend the plans, he said, adding the company needs to be prudent in investments if a slump in demand looks likely to continue.
Bada also said almost all the JFE Steel’s long-term clients, who are in automobile-making, shipbuilding and other engineering industries in Japan and Asia, have been sharply falling. Thus, the company needs to think twice about the two projects, one in Vietnam and the other in Brazil. (Thanh Nien Daily, Lao Dong online)
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