...FE to Delay Decision on $3.6 Billion Steel Plant in Vietnam Masumi Suga and Yasumasa SongDec 07, 2012 1:48 am ET (Updates with closing share price in fifth paragraph.) Dec. 7 (Bloomberg) -- JFE Holdings Inc., Japan’s second- biggest steelmaker, will push back a decision on whether to build a $3.6 billion integrated steel mill in Vietnam, its first outside Japan, as it assesses competitive risks. “We initially said a conclusion will be reached by the end of this year, but we’ll need a bit more time,” Eiji Hayashida, president of steel unit JFE Steel Corp., said in an interview Dec. 5 at the company’s Tokyo headquarters. “Things won’t go smoothly until we make sure that we’ll beat the competition as many projects are being lined up to build new mills in southern China and Vietnam.” JFE’s plan is part of a push to be closer to customers in markets where demand is surging for Japanese products such as cars. The company’s challenge will be to cope with the high cost of setting up a plant at a time when China’s slowing economy is causing a glut, said Shinya Yamada, an analyst with Credit Suisse Securities Japan Ltd. “It’s no use to go ahead with the project when the industry is struggling with excess steel supply,” said Yamada, who has an outperform rating for JFE shares. “The risk is high.” JFE rose 0.9 percent to 1,310 yen in Tokyo, paring the stock’s decline this year to 6 percent. The key Nikkei 225 Stock Average has gained 13 percent since Jan. 1. Feasibility...
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...Analysis of Indian Iron and Steel Industry Table of Contents 1Introduction.......................................................................................................... 3 1.1Varieties of Steel................................................................................ ...............5 1.2Production Technology .....................................................................................6 1.3Components of the cost of production..............................................................7 2The Global Steel Industry.....................................................................................9 3The Structure of Indian Steel Industry...............................................................10 3.1Factors that attribute to the Revival of the Indian Steel Industry....................11 3.2Consumption of Steel in India.........................................................................16 3.2.1Top Five Companies.....................................................................................16 3.2.2Bottom Five Companies..............................................................................25 4Quantitative Analysis.........................................................................................32 4.1Ratio Analysis................................................................................................. .32 5Qualitative Analysis.........................................................................................
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...Introduction to the industry Metals have accompanied mankind since ancient ages, and steel, if we begin to follow it from the moment of its historically famed damascene form - for some millennia. From the era of craftsman-like small-scale production to today's form of industrial mass production, steel has covered an intricate path lined with significant innovations in production processes, development of range and quality of products, and perpetually growing productivity of labour, improving economies and ecological load. In addition, a radical change in relationship to the customers is occuring at the end of this century, namely by a pronounced shift of readiness towards the needs and requirements of these customers. Steel's indisputable significance is confirmed by the fact that it has become the second most mass-produced commodity after cement production, attaining the world-wide production volume of approx. 750 mil tons yearly. The art of iron production from ore arose in connection with the practices of copper and lead technologies in Anatolya, in northern Syria and possibly also in part of Iran. Iron ores were added as fluxes for treatment of sulphide copper ores. Iron drops, which the local manufacturers identified already 3000 years BC, comparing these with meteoritic iron, already hinted at the existence of the possibility of producing iron, but this only occurred practically 15 centuries later. Since that time, it is necessary to reckon that only small amounts of this...
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...Indian Steel Industry India is among the top producers of all the form of steel in the world. Low cost manpower and the abundance of iron ore and coal reserves makes India highly competitive. India became the 4th largest producer of crude steel in the world in 2010 as against the 8th position in 2003 and is expected to become the second largest producer of crude steel by 2015. The country has acquired a central position on the global steel map with its giant steel mills, acquisition of global scale capacities by players, continuous modernization and up-gradation of old plants, improving energy efficiency and back integration into global raw material sources. A new research report Indian Steel Industry Outlook to 2012 says that the, Indian crude steel production will grow at a CAGR of around 10% during 2010-2013. The demand for steel is a derived from the demand from other sectors like automobiles, consumer durables, and infrastructure. With the government proactive incentive plans to boost economic growth by injecting funds in various industries, such as construction, infrastructure, automobile, and power will drive the steel industry in future. Led by strong demand for autos and engineering services, the domestic steel demand in India remains robust, as per Moody's sectoral analysis on Asia's steel sector. According to the analysis, the outlook for the domestic operating environment is positive, driven by robust growth in infrastructure, autos and construction and constrains...
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...Steel Industry The Bangladesh Steel Re-Rolling Mills, commonly known as BSRM, is a Bangladeshi steel manufacturing conglomerate based in Chittagong. It was founded in 1952, when the Ismaili Africawala brothers established the first steel rolling plant in erstwhile East Bengal.[2][3][4] Products: XTREME 500W GRADE 60 STRUCTURAL SECTION SPRING STEEL BSRM was the first steel company in Bangladesh to receive ISO 9001:2000 certification. The system has been continuously modified and developed in many surveillance visits by the lead assessors and BSRM continues to develop it in a manner consistent with International Certification Practices. The company is also in the process of securing the globally acknowledged, U.K. based CARES product certification and registration. The aim of the system is to work for the consistent assurance of quality and its implementation will ensure product quality and thus customer satisfaction. Due to the nature of the industry, where in-process materials are not present, final product testing is done in a modern testing lab equipped with computerized testing machines to measure chemical and mechanical properties. Finished goods are stored in intermediate quarantine until clearance from Quality Control and then stored in the finished goods storage area ready for delivery. Product traceability is ensured through a label that shows the date of production and other information such as diameter, length, weight of bundle and grade. This quality system...
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...STEEL INDUSTRIES OF BANGLADESH REPORT ON FOCUS The report “Bangladesh on its way of becoming self sufficient in rod production, export is also a possibility” by Shuvankar karmakar, that was analyzed here, was published in the Daily Prothom Alo, on 17th November, 2012. BACKGROUND Bangladesh Steel industry is emerging as one of the major industrial sectors of the country. It consists of small up to the largest scale of steel melting and re-rolling factories across the country that mostly produce deformed bar rod of different grade (40, 60, 500), angel, channel and coil for the construction industry. Though the history of Steel Industry is not older one but it can make a glorious future. Before 1971 Bangladesh did not have any steel mill and even after the liberation there were only a few steel factories in the country. In 1990s the actual development began in this sector through a revolution. During that period the building constructing agencies or developer companies came forward to build modern infrastructure. Then with the increasing demand, new investors started investing in steel or rod production. In 2012 we have almost 400 mills across the country including Dhaka, Chittagong. Although most of them are manual steel plants, 30 mills among them are automated. Many steel producing companies have gained reputation as a brand. Among them, BSRM, KSRM, Anwar Steel, AK steel, Rahim steel, Abul khayer Group are worth mentioning. Today the highest steel producing company is...
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...Profile of Steel Industry in India (Managerial Economics) CONTENTS Introduction Market Size Investments Government Initiatives Steel Prices Supply and Demand Analysis Cost of production Production Functions and Input: Fixed & Variable Inputs: Total & Average cost: Calculating Average Total Cost Average cost and Economics of Scale: Market Structure of steel industry: Price Discrimination in the Steel Market SWOT Analysis of Steel Industry: Indian Steel Industry a Bright Future Understanding the Steel industry using Michael Porter’s Five Forces Model Suggestions Road Ahead Major Steel Producers Introduction India has acquired a central position on the global steel map with its giant steel mills, acquisition of global-scale capacities by players, continuous modernisation, and improvement in energy efficiency. Steel companies from across the world have shown interest in the Indian steel industry due to its phenomenal performance. In India, the steel industry plays a significant role in the economic growth. India is world's fourth largest crude steel producer in 2011-12 with 89 million tonnes (MT) as per provisional data and is expected to become the second largest producer of crude steel in the world by 2015-16. India is also the world's largest producer of sponge...
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...Steel is a unique and vital material. It touches almost every part of modern life. It is a key element of our infrastructure. From buses to buildings, from canned food to computers, almost everything we see around us is either made of steel or is made using steel. Steel is essential to modern society. Tata Steel is the second largest steel producer in Europe and has its main steelmaking plants in the UK and Holland. It supplies steel and related services to major industries, such as construction, vehicle production and packaging. The European operations are a subsidiary of Tata Steel Group, one of the world’s top ten steel producers. The combined Group has around 80,000 employees. The challenges of sustainability A commitment to environmentally-sound practices is part of many businesses’ commitment to act responsibly. Social responsibility refers to an organisation’s obligations to maximise its long-term positive impacts and minimise its negative impacts on society. For Tata Steel, it is a core part of its vision to be ‘the global steel industry benchmark for value creation and corporate citizenship.’ Tata Steel is committed to tackling the challenges of sustainability. This means that it takes its responsibility towards both the environment and its communities seriously, balancing these against the need to make a profit. It has put systems in place to meet international standards for environmental management such as ISO14001. Respecting and safe-guarding the environment is...
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... CR retail distribution, and geographic segmentation. In OEM distribution, the customers specify the grade of steel that they require and the company takes responsibility to supply them the same grade of steel in the agreed cut to size condition. In retail distribution, companies maintain stocks of material for feeding its retail chain and provide Value for money products. In Distribution, the Steel Mills are the key suppliers and they play a very valuable role in the supply chain as they are responsible for providing the correct quality of steel, its timely delivery, post- sales support and joint marketing support. TATA STEEL DISTRIBUTION CHANNEL G C sheets: Traditionally G C sheets were considered as a commodity. Over time, TISCO has succeeded in differentiating its product and becoming a market leader. Presently it has 32% market share in the G C sheets industry. The company serves a wide variety of consumers, ranging from reputed contractors to retail users from the private sector organisation to the public sector undertakings. These consumers can be classified into 3 major groups: 1) Government 2) Retailer (B TO C) 3) Private sector consumers (B TO B) To cater to the needs of all its consumers, the company does both (B to B selling) and retail outlets (B to C selling). Bulk orders come under direct selling and small order from retail outlets. Tata steel has selected 28 distributors in different location across India. Every distributor is given 2 days training session...
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...THE UNITED STATES STEEL INDUSTRY * Porter’s five forces model * Risk of entry by potential competitors * Absolute cost advantages: From this case we can identify that steel industry in different categories has various type of cost advantages. For eg: those small steel makers minimills who used arc furnaces to smelt and produce scrap steel which usually cost lower than large established companies who used iron ores that requires huge investment and tends to raise their cost. More over another absolute cost advantage that had over established companies are that they used and located in rural areas where labor costs were relatively low and established companies used unionized labor and in flexible work rules that increases their cost. As a result we can say that absolute cost advantage was achieves by small steel maker but established industry did not have any cost advantage * Customer switching cost: Basically customer considers steel as a commodity type good as mentioned in the case for which they could easily switch from company to company and they took this as an opportunity to bargain down prices further. * Government regulations: as mentioned in the case low trade barriers took away market share away from companies that once dominated the industry. This led to creation of many new small companies that could operate at low cost which resulted in intense competition and lost profits * Rivalry among established companies: Rivalry among established...
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...The Current Situation Facing the British Steel Industry Andreea-Adina Criclevit 03.04.2016 This report aims to critically analyse and evaluate the current situation facing the British Steel Industry using contemporary information and a combination of theories such as ‘The International Product Life Cycle’ and ‘Porter’s Diamond of National Advantage’. Background: Steel is a vital material in the process of economic expansion and it has been very important for the society, considering that the level of consumption of steel/ capita can be used as an index of the level of social wealth, political and economic stability. The steel industry is closely linked with numerous industrial sectors and it promotes the innovation, growth and employment of the European member states. Although the EU is the second largest producer of steel in the world after China its goal is to increase the market share of GDP by 20% in 2020. The British Steel industry is necessary tool, without which, the manufacturing success would not have happened. In 1972, the steel production level has reached an all-time peak of 28 Mt (million tonnes) per year and offered more than twice as many jobs as it does now. Referencing back to Michael Porter’s Book, ‘The Competitive Advantage of Nations ‘, in year 1945, there were 50 mills of steel all throughout UK and it has been reduced to 7 in 1970. Following this, the decision to privatise the British Steel Industry was taken by Margaret Thatcher in 1988, however...
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...certain materials in the manufacture of its product; Acquire or rent/lease certain machineries and equipment in the production of its goods; Issue stocks or negotiate for a bank loan to increase its working capital; Make decisions regarding investing or lending capital; Other decisions that allow management to make an informed selection on various alternatives in the conduct of its business. INDUSTRY PROFILE Iron & Steel sector in India is on growing because of the tough international and national demand. India's swift economic growth and towering demand by sectors like construction, infrastructure, and auto sector, at domestic and globally, has placed Indian steel industry on the international map. According to the recent report by International Iron and Steel Institute (IISI), our country is in the seventh place as one of the major steel producer in the world. The beginning of the new steel era in India can be traced back to 1953 when a treaty for the construction of an integrated steelworks in Rourkela, Orissa was signed between the Indian government and the German companies Fried Krupp und Demag AG. Initially a plan with an annual capacity of 500,000 tonnes has been drawn, but this has...
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...The Bangladesh Steel Re-Rolling Mills, commonly known as BSRM, is a Bangladeshi steel manufacturing conglomerate based in Chittagong. It was founded in 1952, when the Ismaili Africawala brothers established the first steel rolling plant in erstwhile East Bengal.[2][3][4] Products: XTREME 500W GRADE 60 STRUCTURAL SECTION SPRING STEEL BSRM was the first steel company in Bangladesh to receive ISO 9001:2000 certification. The system has been continuously modified and developed in many surveillance visits by the lead assessors and BSRM continues to develop it in a manner consistent with International Certification Practices. The company is also in the process of securing the globally acknowledged, U.K. based CARES product certification and registration. The aim of the system is to work for the consistent assurance of quality and its implementation will ensure product quality and thus customer satisfaction. Due to the nature of the industry, where in-process materials are not present, final product testing is done in a modern testing lab equipped with computerized testing machines to measure chemical and mechanical properties. Finished goods are stored in intermediate quarantine until clearance from Quality Control and then stored in the finished goods storage area ready for delivery. Product traceability is ensured through a label that shows the date of production and other information such as diameter, length, weight of bundle and grade. This quality system ensures...
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...Andrew Carnegie was one of the wealthiest businessmen during the 19th century due to rise in the steel industry. He was a poor Scottish man turned philanthropist who did not believe in dying a rich man and had made many donations to help expand the Public Library of New York. He wasn’t a gambling man but gambled everything he had to the bettering of the United States. He began working for the railroad and during that time started investing his money. He soon found out that that investing wisely, especially in oil, gave profitable returns that soon led to him leaving the railroad company to focus on other interests like the Keystone Bridge Company. Afterwards Carnegie began dedicating himself to the steel industry, which is what brought him...
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...PESTEL ANALYSIS: A REPORT ON UNILEVER Uhomhoabhi Fredrick Albert Codewit Publications, Helsinki, Finland, http://www.publications.codewit.com May 14, 2008 INTRODUCTION TO THE COMPANY The Fast Moving Consumer Goods (FMCG) environment is rapidly changing. Especially, the increasing popularity of line extensions seems to depend on advantages inherent in brand leveraging. FMCG manufacturers go into R&D in order to come up with the product that best satisfy consumers because customers become more critical about attaching themselves to a particular brand. They will also like to buy less expensive product due to current economic tide. Unilever is one of the biggest Fast Moving Consumer Good (FMCG) companies in the world. I have always been inquisitive about Unilever’s operations because I use some of its products, even right from childhood. This together with the current environmental challenges being faced by FMCG manufacturers motivated me to find out about Unilever’s operations and the current challenges it faces in the volatile business environment. Unilever was founded in 1930 through merger by the British, Lever Brother; and the Dutch, Margarine Unie; now Unilever PLC in London, U.K and Unilever N.V in Rotterdam, Netherlands respectively. In 1872 before the merger, Jurgens and Van den Bergh, the Dutch, built factory in Netherlands for the production of Margarine made from milk and fact. In 1927, they formed Margarine Unie (margarine Union) together with two European Businesses...
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