Hubei-based Chinese steelmaker Wuhan Iron and Steel Co. (WISCO) has announced that it is continuing to make preparations for its Fangchengang project in the southwestern Chinese region of Guangxi and is awaiting the approval of the central government, hoping that construction work on the project can start within 2010.
An official at WISCO said that the company's focus on Fangchenggang is based on three factors including lower costs of transporting iron ore, greater ease in export of finished steel and China's grand western development program. He also added that Fangchenggang port, as a deepwater port in southwestern China, would enable WISCO to save RMB 200/mt ($29/mt) by the unloading of Brazilian iron ore at this port, compared with unloading at WISCO's headquarters in Hubei.
The first phase of the project in question, with an annual capacity of 10 million mt, is expected to cost a total investment of RMB 69.8 billion ($10 billion). It is expected that the project will generate an annual sales revenue of RMB 66.2 billion ($9.7 billion) and pre-tax profit of RMB 13.2 billion ($1.9 billion).