Japan’s Kobe Steel, Ltd. and shareholders of Kobe Special Steel Wire Products (Pinghu) Co., Ltd. (KSP), have agreed to invest approximately $8 million increase the production capacity of the Chinese joint venture that processes special steel wire rod into steel wire.

A press release said that the latest announcement marks the fifth time that production will have been increased for the joint venture, which includes partners Shinsho Corporation, Osaka Seiko Limited, Meihoku Kogyo Co., Ltd., Metal One Corporation and Kyodo Shaft Co., Ltd.

KSP was established in 2007 to supply steel cold heading (CH) steel wire to parts manufacturers for use in making products such as automotive bolts, nuts and bearing products, the release said. Full-scale operation began in 2009. Kobe Steel provides all special steel wire rod used by KSP to ensure that the joint venture production has the same high-quality material.

The release said that the latest capacity expansion was needed to help meet the growing needs of KSP’s customers. Approximately $8 million will be spent to install three additional wire drawing machines, for a total of 11, and two more heating furnaces, bringing the total to eight. The new equipment is anticipated to start up in March and June 2020, respectively. Production capacity will increase to 5,500 metric tons per month, it said.

Kobe Steel has positioned Japan, the ASEAN countries, North America and China as four major areas to process special steel wire rods for supply to parts manufacturers who have set up operations in these countries and regions. To date, Kobe Steel has established two plants in Thailand for wire rod processing, one in the U.S., one in Mexico, and four in China. Looking to the future, Kobe Steel will continue to develop its supply network for high-quality special steel wire rods centered on these four areas.