May 25, 2013 / 8:26 AM / in 5 years

Kobe Steel mulls shutting blast furnace in western Japan -Nikkei

TOKYO, May 25 (Reuters) - Kobe Steel Ltd is considering shutting a blast furnace in Kobe, western Japan, to cut production capacity by 20 percent, the Nikkei business daily reported on Saturday, as it tries to turn around its loss-making iron and steel business.

Its iron and steel operations posted an ordinary loss of 50.2 billion yen ($496.1 million) in the year ended March after sluggish demand from shipbuilders and fierce competition from Asian rivals, such as South Korea’s Posco and China’s Baoshan Iron & Steel.

“Nothing has been decided at this stage,” said Kobe Steel spokesman Hiroyuki Yabuki.

Rival Nippon Steel & Sumitomo Metal Corp said in March it planned to mothball one of three blast furnaces at its Kimitsu steel mill around March 2016 and to delay the start of a new blast furnace at its Wakayama plant.

$1 = 101.1850 Japanese yen Reporting by Yoko Kubota; Editing by Paul Tait

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