Sojitz forms alliance with Jiangsu Shagang as steel demand grows
Japan's Sojitz Corp said it teamed up with Jiangsu Shagang Group Co, China's largest privately owned steelmaker, as demand increases in the world's biggest market for the alloy.
The alliance will cover supplies of iron ore and factory equipment, Kenji Asano, general manager at Sojitz's steel business department, said. The accord will also include joint development of the Southdown iron ore project in Western Australia, he said, without giving financial details.
Sojitz, Japan's sixth-largest trading company, is targeting mills in China, which produces half of the world's crude steel. Iron ore imports by China rose 26 percent last month to the second-highest this year as steelmakers restocked on expectations prices will rise.
"We're seeking to expand our business opportunities by getting involved in a wide range of fields," Asano said on Monday in the interview.
The Southdown project, 70 percent owned by Grange Resources Ltd, Australia's largest iron ore pellet producer, and the rest by Sojitz, is slated to start operations in 2014, Asano said. Shagang holds a 47 percent stake in Grange, according to data compiled by Bloomberg.
