- Write by:
-
Friday, May 26, 2023 - 17:10:53
-
205 Visit
-
Print
Mining News Pro - Nippon Steel Corp is still in talks with Teck Resources, despite Glencore’s bid for the Canadian miner, as Japan’s top steelmaker remains eager to take a stake in Teck’s high-grade coking coal asset, a senior executive said.
“We are still negotiating with Teck toward making an equity investment in coal assets,” executive vice president Takahiro Mori told Reuters in an interview on Wednesday.
“The amount of our investment may need to be lifted due to Glencore’s bid, but we are determined to take 15% or more stake in the coal asset so that we can make it an affiliate unit,” he said.
Nippon Steel said in February it will spend around 1.15 billion Canadian dollars ($860 million) to buy a 10% stake in Elk Valley Resources Ltd (EVR), the coking coal unit to be spun off from Teck, with a right to raise its stake to maximum 17.5%.
But Teck last month withdrew its plan to split its coal and metals business after it failed to receive shareholders’ approval. The company’s board rejected the offer from Glencore and said it will come up with a new simplified plan of separation.
Nippon Steel, the world’s fourth largest steelmaker, wants to invest in Teck’s high-quality coking coal to secure a stable supply of the key steelmaking ingredient and to gain profits from the asset, Mori said.
Nippon Steel has said it plans to buy more stakes in coking coal and iron ore mines to hedge against volatility in the price for the raw materials. Currently, 20% of Nippon Steel’s annual coking coal imports of 27 million tonnes are supplied by mines in which it holds stakes.
Asked whether Nippon Steel would invest in the coal asset if Glencore buys Teck, Mori said: “there could be a different decision if thermal coal and coking coal are integrated,” pointing to a negative implication in terms of climate action.
China demand
Steel prices in Asia have been under pressure in recent months amid patchy economic recovery in top consumer China.
The outlook for demand in China has deteriorated compared to three months ago and a recovery could be delayed till next year, Mori said.
“Demand is expected to stay weak for a long time, with no firm economic stimulus policy in place and the real estate market remaining sluggish,” Mori said.
To cut carbon dioxide emissions, Nippon Steel is considering shifting to electric arc furnaces from blast furnaces at two of its domestic steelmaking plants.
“If we decide to do it, it must be done by 2030,” Mori said.
Short Link:
https://www.miningnews.ir/En/News/622974
![Whitehaven Coal sees higher prices on disruptions](/Incsys/Photo.aspx?image=/Uploads/News/20240723142535752.jpg&width=236&height=180)
Australia’s Whitehaven Coal said it expected higher prices for steelmaking coal in the near and medium term due to ...
![Copper price set for worst week since 2022 as China Plenum disappoints](/Incsys/Photo.aspx?image=/Uploads/News/20240723142415052.jpeg&width=236&height=180)
Copper prices have retreated from a record in May on concerns about the strength of demand in China, where growth was ...
![Zimbabwe’s Kuvimba signs $310 million lithium mine deal](/Incsys/Photo.aspx?image=/Uploads/News/20240723141944589.jpeg&width=236&height=180)
Zimbabwe’s state-owned Kuvimba Mining House has signed a $310 million deal with a consortium of British and Chinese ...
![China copper smelters plan to cut output after margins fall](/Incsys/Photo.aspx?image=/Uploads/News/20240723135544917.jpg&width=236&height=180)
Two Chinese copper smelters have laid out plans to reduce production next year as an imbalance between mine supply and ...
![Iron ore majors ramp up supply even as China faces challenges](/Incsys/Photo.aspx?image=/Uploads/News/20240723135340184.jpeg&width=236&height=180)
The world’s biggest iron ore producers are hurling plenty of dirt, adding tons of the steel-making commodity to the ...
![Iron ore price slumps to 3-week low on weak China demand](/Incsys/Photo.aspx?image=/Uploads/News/20240723134623774.jpeg&width=236&height=180)
Iron ore futures prices slumped to a nearly three-week low on Wednesday, undermined by weak seasonal demand from top ...
![China stainless steel mogul fights to avoid a second collapse](/Incsys/Photo.aspx?image=/Uploads/News/20240723134429281.jpeg&width=236&height=180)
Chinese metal tycoon Dai Guofang’s first steel empire was brought down by a government campaign to rein in market ...
![BHP posts second straight year of record iron ore production](/Incsys/Photo.aspx?image=/Uploads/News/20240723134042848.jpg&width=236&height=180)
BHP Group on Wednesday reported record annual iron ore production for a second consecutive year, helped by improved ...
![Zijin Mining to take 9.9% stake in Montage Gold](/Incsys/Photo.aspx?image=/Uploads/News/20240723133352629.jpeg&width=236&height=180)
Canadian miner Montage Gold on Tuesday said Chinese mining firm Zijin Mining Group would take a 9.9% strategic stake in ...
No comments have been posted yet ...