TOKYO (Reuters) - China’s Baosteel Group’s acquisition of Wuhan Steel will create stronger leadership in the country’s steel industry and promote structural reform, the chairman of the Japan Iron and Steel Federation said on Wednesday.
“We welcome the move as the higher concentration will help advance structural reform in the Chinese steel industry,” Kosei Shindo, the chairman of the Japan Iron and Steel Federation, told a news conference.
China’s Baosteel Group fleshed out its plans to buy rival Wuhan to create the world’s second-largest steelmaker behind ArcelorMittal last week, part of Beijing’s effort to consolidate its fragmented steel industry.
Shindo, also president of Nippon Steel & Sumitomo Metal Corp, said Japan’s biggest steelmaker would need to raise its product prices to reflect surging prices of coking coal. Prices of steelmaking coal, known as coking coal, have more than doubled this year.