OREANDA-NEWS. July 26, 2011. Over the past six months of the first year of "The Twelfth Five-year Plan", Ningbo Steel was under the unfavorable market environment. Especially since the second quarter Ningbo Steel is under the severe conditions of the sharp drop in domestic steel market, but the company still has achieved actual effect by insisting on the management idea of "Low Cost and High Efficiency" and creatively implementing a number of response measures in the fields of procurement, manufacturing, sales and financing means. In the first half of this year, the sales of the hot rolled coils of Ningbo Steel reached 2.23 million tons. And profits are achieved over 400 million yuan, which is accounted for 67% of the full-year profit target, reported the press-centre of Baosteel.

Facing the volatile upstream original fuel market, Ningbo Steel carries out the strategic procurement on the basis of ensuring supply in this year. In the first quarter, the procurement of iron ore was implemented according to the thought of "Achieveing long-term agreement price, expanding variety, replenishing inventory and adjusting structure". In the second quarter, the main work was to reduce inventory and expand variety. And great efforts were made to improve the proportion of the long-term agreement price. The percentage of the long-term agreement price of the iron ore has increased from 46% in the last year to 86% in the first half of this year. Therefore, the procurement costs were reduced greatly. Furthermore, Ningbo Steel intensified efforts to develop new coal, new mineral and optimizes the structure of ore proportioning continuously. The following new varieties such as Hainan fine ore, Malaysia ore, Dazhou lean coal, etc. were adopted successfully in the first half of this year.

Based on the customer demand and production schedule, Ningbo Steel strengthens the production control comprehensively and organize and coordinate the running of the production lines. By this, the production connection balance between iron and steelmaking and steel rolling is kept effectively. The line capacity is fully released and then the capacity of the hot rolled coils is improved steadily. Moreover, Ningbo Steel is vigorously promoting the production organization project for the direct charging rate and the hot charging rate in this year. In April, the direct charging rate and the hot charging rate reached 62.3% and 76.9% respectively. Both of them are at the best level. Oriented on the market demand, Ningbo Steel conducted an investigation on the market of varieties steel and steel for special specifications in Zhejiang Province and its surrounding areas in the field of production and sales. Combined with the technical capacity and the requirements of profit maximization, Ningbo Steel pointed out the key and expanded the variety and specification such as B480GNQR container board and SAPH automobile structural steel, etc. In the first half of this year it expanded 420,000t and the added benefits was up to 33.23 million yuan.       
  
With the tightening of the macroeconomic policies, the financing costs of the domestic enterprises rise continuously in this year. In order to reduce finance costs and achieve low-cost financing, Ningbo Steel innovated the financing modes actively. In May of this year, Ningbo Steel implemented the first business of dollar financing successfully. The single amount of the business reached USD 29,650,000. The yearling comprehensive financing costs are only 2.5%. In June, Ningbo Steel successfully started to issue short-term financing bonds and opened up new financing channels on the basis of the great improvement of business performance after the reorganization. From January to May, the integrated capital cost rate of Ningbo Steel is 4.2%. The financing costs are reduced by nearly 60 million yuan.
 
The work of energy saving & emission reduction of Ningbo Steel also took a new step forward in the first half of this year. Energy consumption index and emission index are all better than the target values set in the beginning of the year. Thereof, the comprehensive energy consumption per ton steel was reduced by 3.1% and the pass rate of pollutant emission increased by 1.5%. The energy consumption of key processes is improved greatly. It is showed in the data of the first half of this year that the energy consumption of negative energy steel-making process and hot rolled process in the Ningbo Steel has already been at the leading level in the domestic metallurgical industry.