Shanxi mill plans to spend 15b yuan to double capacity as competition intensifies
Shanxi-based private steelmaker Haixin Iron and Steel Group, which plans to invest 15 billion yuan (HK$16.89 billion) over the next three years to more than double its capacity, is in talks to bring in industrial investment funds as strategic investors, according to an executive.
'The best means of survival is to get bigger amid rising costs and intensifying competition. We aim to boost our annual production capacity to 15 million tonnes by 2010, from about 6 million tonnes at present,' chairman Li Zhaohui said recently.
China, the world's largest steel producer, has thousands of mostly small steel mills.
Crude steel production last year amounted to 489 million tonnes, but only about 70 mills have an annual capacity of more than a million tonnes.
Haixin, the second-largest steel mill in the coal-rich province, targets production of about 5.8 million tonnes of steel this year. The firm is regarded as a medium-sized mainland mill.
