( AFP )- Japan's Nippon Steel Corp. plans to build a new production facility in Brazil amid stiff competition with rivals such as ArcelorMittal in fast-growing economies, a report said Tuesday.
Japan's biggest steelmaker Nippon Steel expects to spend between 500 and 600 billion yen (5.0-6.0 billion dollars) on the mill in the southeastern city of Cubatao , the Nikkei business daily said without citing sources.
Nippon Steel is expected to begin construction this year through a joint venture with local affiliate Usinas Siderurgicas de Minas Gerais SA, or Usiminas . The mill is due to begin operating in 2011, the daily said.
But the company said the report was incorrect.
"Nippon Steel does not plan nor intend to build a furnace as reported in the article. We are currently in the process of mulling a plan announced last August that Usiminas would construct a furnace," a company spokesman said.
The report said it would be Nippon Steel's first new mill since 1971 and its fifth fully integrated production site.
A first blast furnace would be built for about 300 billion yen with an annual output of three million tons while a second furnace would be added as early as 2015, doubling production to six million tons, the report said.
Usiminas facilities will process part of the intermediate steel material made at the new complex for sales in South America, while unfinished material would be shipped to the US and Europe to make automotive steel sheets, it said.
Competition between the world's largest steelmakers is intensifying amid a scramble to supply a construction boom in fast-growing emerging economies such as China and India.