BlueScope Steel: China-Australia important trading partners
China has emerged as one of Australias largest trading partners and is set to soon end Japans 40-year long reign as Australias largest export market. The increasing level of trade is based on Australias strengths in raw materials such as iron ore, coal and crude oil, similar to its exports to other Asian countries such as South Korea, Japan and Taiwan. Australian investment in China, during the same period, however, has slowed. The total amount of Australian investment in China is roughly A$1.5 billion ($1.1 billion), equal to only about half the amount Chinese companies invested in Australia, according to the Australian Bureau of Statistics. Officials from Australian steel producer BlueSteel have announced that the company is the largest single Australian investor in China, with an investment of over A$500 million ($369 million) in the last decade. Moreover, BlueScope has also made an investment of A$280 million ($270 million) in a coated steel plant in Suzhou near Shanghai, which is currently under construction. Upon completion the plant will have an annual capacity of only about 250000 tons when it opens in 2006. This figure will be just a very small fraction of Chinas total steel production which is expected to exceed more than 300 million tons a year by that time. BlueScopes current strategy is to take advantage of its small product range and carve out a niche for itself in the market by solely focusing on high value-added orders, mainly for large construction projects. The company is focusing on supplying steel, and in some cases, together with its local subsidiaries, engaging in the construction of factories, power stations, and public buildings such as stadiums, airports and increasingly housing projects.