Japan’s Sumitomo Corporation and the Vietnamese company SMC are working together on a project to set up a steel processing plant.
Under the plan, the US$4M joint venture will process and distribute high-quality steel for construction projects. The joint venture will also act as an agent for Japanese construction steel companies selling their products in Vietnam.
The joint venture, set to be launched in April, aims to sell 50kt of steel by the end of 2012, and 150kt of sales earning 10bn yen (US$125M) by 2015.
SMC has a 50% share in the joint venture, Sumitomo Corp 30%, Sumisho Tekko Hanbai a 15% share and Sumitomo's Vietnamese subsidiary a 5% share in the joint venture.
The joint venture uses existing warehouses on 2400m2 of land at an SMC property. The project aims to expand if local demand for steel continues to be high.
It is estimated that Vietnam will require about 8Mt of high quality steel in 2013, an increase of 60% against the figure for 2010.
Many Japanese steel businesses have invested in the construction market in Vietnam in recent years. Before Sumitomo, Nippon Steel & Sumikin (NISC), also known as Marubeni-Itochu Steel, announced their plans to build joint-venture steel factories in Vietnam while the JS Construction Group recently decided to build a factory specialising in making door frames for civil housing construction projects.
Source: Daily ‘Vietnam News’, Hanoi; 6 Mar 2012