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Company News, 2008-10-30, 04:00 PM

Premier Jürgen Rüttgers visits new steel mill being built by ThyssenKrupp Steel in Brazil: “Important investment will also strengthen North Rhine-Westphalia as an industrial center”

The Premier of the German state of North Rhine-Westphalia, Jürgen Rüttgers, today visited the site of the new steel mill being built by ThyssenKrupp Steel in Santa Cruz , Brazil (near Rio de Janeiro). Rüttgers described ThyssenKrupp’s project as an “important investment that will also secure jobs in North Rhine-Westphalia and strengthen our state as an industrial center.” In Santa Cruz ThyssenKrupp Steel is building an integrated steel mill with an annual capacity of 5 million metric tons of slabs. During his visit, the Premier was also updated on the company’s strategy. With its business model focused on premium flat-rolled carbon steel ThyssenKrupp Steel is well positioned in its core European market. In recent years the portfolio has been systematically concentrated on high value-added products.

Dr. Karl-Ulrich Köhler, member of the Executive Board of ThyssenKrupp AG and CEO of ThyssenKrupp Steel AG, explained that in the medium term ThyssenKrupp Steel aims to increase its deliveries from currently 14 million tons to 20 million tons with a global growth strategy. This strategy is based on long-term forecasts for the premium flat-rolled carbon steel market, which is growing at an above-average rate of 6% per year. Almost half of consumption is focused in the volume markets of Europe and North America. “To strengthen our market position in these regions, we will be investing over €7 billion in the coming years,” said Dr. Köhler.

Of central importance to the implementation of the growth plans is the steel mill now being built in Brazil at a capital cost of around €4.5 billion. Following the ramp-up of the facilities from the end of 2009 the new mill will produce around 5 million tons of slabs to high quality standards and with an optimal cost position. 3 million tons of the slabs will be supplied to the new processing plant near Mobile in Alabama, which is likewise under construction and is due to start operation in 2010. It is being built in conjunction with sister segment Stainless. The total investment is €3.1 billion, of which ThyssenKrupp Steel’s share is €2.3 billion.

The additional crude steel capacity in Brazil will also benefit the company’s highly efficient plants in Germany – mainly in North Rhine-Westphalia. To allow processing of 2 million tons of slabs from Brazil we are investing €400 million in the expansion of our processing and coating capacities. A large part of the investment is focused on our hot strip mills in Duisburg and Bochum. Individual sub-projects to increase the capacity of existing hot-dip coating lines have already been completed. At the same time we are expanding our infrastructure and slab logistics facilities at the Duisburg-Walsum terminal. The ramp-up of the facilities will remove bottlenecks and allow us to serve key customers in Europe better than before. The extra volumes are covered in full by notified demand from regular customers.

Another milestone in our plans for the future is the start-up of the new blast furnace 8 in Duisburg, which was blown-in on December 8, 2007. The new furnace is part of a larger modernization program which also includes the relining of neighboring blast furnace 9. In total, €340 million is being invested in the blast furnace program, which will ensure that Duisburg remains one of the most efficient steelmaking locations in the world. It will also secure 1,200 jobs directly and another 3,600 indirectly.

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